Most people today have multiple Savings Accounts. There could be many reasons for this, like dedicated accounts for each purpose, multiple job changes, etc. Let’s check out the pros and cons of multiple Savings Accounts and discuss how many accounts you should normally have.
Pros of multiple Savings Accounts
1) Different accounts for multiple goals
Multiple Savings Accounts help you address different goals effectively. For instance, you can have a dedicated account to meet all your EMIs and SIPs while you can have a different account to just maintain your emergency fund. Many companies open Salary Accounts where you receive your salary.
2) Sense of security
Having multiple accounts brings in a sense of security since all your money is not pooled in one place. You can distribute your funds in different accounts to stay safe from hackers and scammers.
3) Flexibility
In case you are unable to operate a particular bank account, all your money doesn't get locked up. You can access the other accounts for your needs until the issue gets resolved.
Cons of multiple Savings Accounts
1) Minimum balance requirement
Most Savings Accounts come with a minimum balance requirement. Failure to maintain a minimum balance in your bank account might lead to penal costs.
2) Loss of interest
Different banks offer different bank interest rates on Savings Accounts. If you distribute money across different accounts, then you are missing out on interest earnings from high-interest-paying banks.
3) Difficult to keep track
You may struggle to keep track and manage multiple Savings Accounts simultaneously. If you fail to maintain a minimum balance across all your Savings Account, the balance may go into negative, and you may lose out on benefits linked to your Savings Account. Also, if you have multiple EMIs and SIPs running and all of them are linked to different bank accounts, then you may end up missing some EMIs. Therefore, it is important to link all your EMIs and SIPs in a single account and deposit money in that account at the beginning of each month.
Also Read: Know how many bank accounts a person can have
In a nutshell
Considering the digitisation of transactions and the rise in banking channels, having multiple Savings Accounts is quite common. However, you need to understand how many accounts are too many accounts!
Axis Bank has been the people’s choice for all their banking needs. One of its exclusive offerings is a Digital Cashback Account that you can open from the comfort of your home. It allows you to enjoy cashback, shopping vouchers, complimentary tickets, and even insurance benefits! Open a Savings Account with Axis Bank today!
Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
