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Is It Bad to Have Multiple Checking Accounts?

By: Chelsea Stefanelli, Director - Deposit Operations and Specialized Services

Posted on 7/22/2022 10:33:08 AM

Parents with young teenage daughter showing her how to use her checking account and debit card online.

Having multiple checking accounts can be very useful if you’ve ever struggled with organizing and tracking your spending. That’s because it allows you to automatically separate different transactions from each other, and this makes it easier to see where you are spending. Here are the things to consider when you are preparing to open more than one checking account.

Having multiple checking accounts helps you easily organize and track spending

When you only have one checking account, all your spending is listed in one place. Gas fill-ups, morning coffee, and other debit charges are all lumped together with things like online bill pay for student loan lenders, or check payments to JEA, etc. Instead of having to waste time searching through so much information to find the specific transaction you are looking for, you can open multiple accounts to better manage your spending.

For instance, what if you had one checking account for those items you buy almost daily? Things like groceries, restaurant meals, parking or ride fares, hair care, and nails, or childcare? In many cases, these can add up to dozens of purchases each week. And that can certainly add up!

Now, what if you use a second checking account for the things that you don't buy every day or even each week? Such as the bills and charges that you budget for each month, or the items you don't normally pay for with your debit card? These can include your:

  • Rent or mortgage payment
  • Electricity and water utility bill
  • Car payment and insurance
  • Cell phone plan
  • Cable and streaming video subscriptions
  • Internet service
  • Gym memberships

Also, if you have a pre-teen or teenager, it can be really useful to have a dedicated account for them as well. By opening a teen checking account, you are able to maintain parental oversight as they begin building their personal finance skills. Best of all, you can set their allowance and easily transfer funds from one of your other checking accounts to one that they can use.

Another helpful purpose for a secondary, or even a third checking account, would be for certain, rather very specific transactions. This can help create higher visibility for direct deposits from an employer, or large purchases where you do not want to give out your primary checking account information.

You can even use an account like this as overdraft protection for other accounts, placing a designated amount inside that can be drawn from if you are close to your limit on another account. There are lots of ways to streamline your life using multiple checking accounts.

Separate business spending from household spending with multiple checking accounts

It makes life much easier if you open a business checking account, instead of using your personal checking for business-specific expenses. Simply because it can be difficult to separate and keep track of your business spending when it's all commingled with your household spending.

For example, let's say you have a small business where you sell handmade jewelry. You use the business account to pay for materials like silver and beads, as well as other business expenses like craft fair booth fees. When you file your taxes at the end of the year, it will be quicker to deduct these business expenses if they are all itemized in one place. The same goes for any personal income you may earn from your small business ventures.

Another example is if you want to have multiple signers on a checking account. With a business account, you can add multiple people who are authorized to perform transactions. This can be extremely helpful if you have a business partner or multiple employees you trust, who are allowed to spend on the company's behalf.

Small business owner carefully adjusting the clasp on beaded bracelet she’s selling at a craft show.

What to consider when deciding how many checking accounts to open?

In addition to being able to more easily separate spending for tracking purposes, there is no cost to you to open multiple checking accounts. Whether it is one, two, three or more, the most important thing is that you have the accounts you need to be financially successful. First think about:

  1. What number of checking accounts are needed?
  2. For what purpose you will need each one?
  3. How many people will use each account as co-signers?

Next, decide which account you will need debit cards for, and how many cards to order. Also, think about whether you will need paper checks or not, because there is a small additional charge to order them. Then get started by walking into one of our convenient locations, or by calling 904.354.8537 to schedule an appointment with a member of team who is ready to help you.

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