Why We Have 13 Bank Accounts (2024)

In our household, we utilize multiple bank accounts to help us stick to our budgetand stop living paycheck to paycheck. We have what you might call an “online envelope system”, to help us keep track of our day to day expenditures. When we tell people we have 13 bank accounts, the first thing they want to know is why we have 13 bank accounts.

We have been using this technique for years now, and we LOVE it! It’s a system that is extremely easy to maintain, and it’s not very complicated at all. We’ve been able to save more money and build wealth using this method.

Check out this video that we put together, that will help detail our process for you to understand.

1. Main Household Checking

This account is used for our income to be directly deposited into. It is from this account that we outsource our funds to our other bank accounts. Some of our utilities do get paid from this account automatically. However, we do not carry a debit card on this account.

2. Dining Out

Every month we set aside money that is dedicated strictly to eating out. It’s much easier for us to have a debit card attached to this account, to use only in the case of eating out. Whether it is ordering takeout or sitting down inside of a restaurant.

This has allowed us to stay on top of our monthly dining budget, without it affecting our main household checking account. Hence, once the money that we budgeted for takeout food is gone for the month, then that’s it for eating out!

3. Non-Monthly Bills Account

We absolutely LOVE this account! We use this account to set money aside monthly, for any bills that are due quarterly, semi-annually or annually. Moreover, this includes bills such as car insurance, homeowners insurance, water bill, life insurance, and garbage disposal.

Each time, our car insurance payment was due every six months; it became difficult to come up with hundreds of dollars to pay the bill. So, we decided to take each bill and break it up into monthly amounts that we put away into this account. When the final bill comes due, the money is already put away to pay it.

Most insurance companies charge you a fee to set up monthly/quarterly billing. Therefore, we decided to pay the money to ourselves monthly and keep it in a separate account. We do not carry a debit card for this account.

4. Real Estate Taxes

This account is used to escrow our property taxes. Instead, of having our taxes escrowed in our monthly mortgage payment, we made the choice to pay ourselves.

5. Tai’s Fun Money

Every month we budget individual “fun money” for each of us. We get to do whatever we want with this budgeted amount, without having to check in with each other. Furthermore, I love having a debit card for this account so that I don’t have to carry cash all of the time. My husband is on the account with me, but it’s strictly used for my pleasing.

6. Vacation

This account is used to put money away for vacations and trips! This account does not get funded each month. We don’t feel it’s necessary to make this a part of our monthly budget. However, we do put money aside from time to time. Especially if we know there is a trip we would like to take in the future.

7. Wealth Building Account

We use this account to help build our retirement funds, pay down our mortgage, or store extra cash that we made. For example, we may buy a piece of used furniture from a thrift store, and then turn around and sell it on Craigslist to make extra money. The extra money that we make is then used to either build our retirement funds or pay down our mortgage.

8. Child #1 Savings Account

We have savings accounts for each of our children. Any money that they may receive for Birthday’s or Christmas, is put into their own separate account with their names on it.

9. Child #2 Savings Account

Same as above

10. Child #3 Savings Account

Same as above

11. Car Fund

We don’t believe in taking out loans for vehicles. Conversely, we believe in self-financing our cars. We pay ourselves a car note and place it into a savings account. Thus, in the event that we need to purchase another vehicle, we have the cash to do so.

12. Household Savings Account

This account is separate from our “Emergency Fund Account”. Therefore, if an appliance breaks down, or if one of our non-monthly bills is much higher than expected, then this is where we pull the money from. Moreover, we always keep this account at a certain balance to cover small emergency situations.

13. Emergency Fund

This account is held at a separate bank and away from our other accounts. We don’t want easy access to this money because it is used for EMERGENCY situations only. Furthermore, this money is used to cover any unforeseen layoffs or any other major financial emergency situations.

FAQs

Why do people have so many bank accounts? ›

Having multiple bank accounts can help separate finances when needed. Couples might want a joint bank account for funds managed together and separate accounts for personal funds. If you're a small business owner, having a different account for your business finances makes it easier for bookkeeping and tax purposes.

How many bank accounts should we have? ›

According to financial experts, it isn't advisable to open more than three Savings Accounts, as it can be difficult to manage. Apart from having a minimum balance in each account, banks might also mark an account dormant if there is no activity for a period of time.

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Do you have to be 13 to have a bank account? ›

Generally, a child must be at least 18 years of age to open a bank account on their own, with some variability by state. However, there are several options that allow children and teens to access the banking experience before 18 with an adult cosigner or custodian.

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Is 10 bank accounts too many? ›

You can have as many checking accounts as you want. Keeping track of multiple accounts is more complicated than a single checking account. However, opening and using multiple accounts can help you better manage your budget, cash flow, and other financial needs.

Is there a problem with having too many bank accounts? ›

Drawbacks to Multiple Bank Accounts

For all the benefits of multiple bank accounts, there are reasons why this choice may not make sense for your finances: More accounts to reconcile. Each month, you'll have more than just a checking and savings account at your local bank to track, which can become confusing.

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How many bank accounts are too many? ›

While having multiple accounts can have its perks, it can also lead to confusion and complicate your financial life. If you find it hard to keep track of all the accounts and their balances, it's best to stick to one or two accounts.

How many bank accounts does an average person have? ›

Consumers in the U.S. had an average of 5.3 different accounts across financial institutions in 2019. The median household bank account balance in the U.S. climbed to $8,000 in 2022. Between 94% and 95.5% of U.S. households have access to at least one bank account.

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Is it good to have a lot of bank accounts? ›

It can be beneficial to have multiple bank accounts. At minimum, it's a good idea to have a checking account (for your spending money and for paying bills) and a savings account. If you want to save for the short term and the long term, or have different savings goals, consider setting up multiple savings accounts.

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How many bank accounts should a single person have? ›

There is no limit set to how many bank accounts you should have. However, it is advisable to have less than four bank accounts per person because it becomes difficult to manage money in multiple bank accounts.

Can you have a bank at 13? ›

Customers between 13 and 16 years old must open the Clear Access Banking account with an adult co-owner.

How much money should a 16 year old have? ›

How to Set an Allowance for Kids. A commonly used rule of thumb for paying an allowance is to pay children $1 to $2 per week for each year of their age. Following this rule, a 10-year-old would receive $10 to $20 per week, while a 16-year-old would get $16 to $32 per week.

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What is the 50 30 20 rule? ›

The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings.

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How many bank accounts should I have at 25? ›

Ideal Number of Bank Accounts

Stroup recommends having at least two bank accounts: a checking account for your day-to-day transactions, and at least one savings account, depending on your financial goals. "From there, it really depends on your situation."

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Is having multiple checking accounts bad? ›

Really, there's no hard and fast rule about how many checking accounts any one person should have. The number and type of accounts that works for you will depend on many factors, including your financial goals, spending habits, and comfort level with monitoring and managing multiple accounts.

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What percentage of people have multiple bank accounts? ›

In GOBankingRates' Best Banks 2023 survey, 56% of overall respondents said they would have different types of accounts across various banks.

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Why do people have multiple checking accounts? ›

Separate accounts can keep business and personal finances from being commingled. Having individual and joint checking accounts could make sense if you're married. A checking account at a traditional bank can be a good backup if you primarily bank online.

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Why do rich people have multiple bank accounts? ›

Yes, most millionaires have several bank accounts. They do this not just because they have a lot of money, but to manage their money smartly and effectively. Having multiple accounts helps them handle their finances in a way that meets their different needs and goals.

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