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 We Have 13 Bank Accounts? ›

In our household, we utilize multiple bank accounts to help us stick to our budget and 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.

Tell Me More ›

Why do people have so many bank accounts? ›

Having multiple bank accounts may help track individual savings goals more easily. Separating finances. For spouses and domestic partners who prefer to split household finances, multiple bank accounts can help you spend and save in a way that's right for your relationship. Raising money-wise kids.

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How many bank accounts is normal? ›

The ideal number of bank accounts depends on your financial habits and needs. You might be happy with just two accounts – checking and savings – or you may want multiple accounts to separate business and personal expenses, share a bank account with a partner or maintain separate accounts for various financial goals.

How many bank accounts is it legal to have? ›

There's no limit on the number of checking accounts you can open, whether you have them at traditional banks, credit unions or online banks. There is, however, a limit on how much of the money you keep in your checking account is FDIC insured.

What is the maximum number of bank accounts you can have? ›

Yes, there is no limit on how many savings accounts you can have. But, if the bank detects no activity in your account for a while, it can be marked dormant. In addition, keeping the account idle can also attract various charges, which will eventually lead to a decreased bank balance.

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Is it bad to have lots of bank accounts? ›

Will having two or more current accounts damage my credit score? Not necessarily, no. However, having two or more current accounts won't necessarily damage your credit score, but it could have a negative impact if you start dipping into multiple overdrafts – making it look as if your finances are becoming stretched.

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

Before you decide, consider some of the reasons it might be bad to have multiple bank accounts at different financial institutions. It may be harder to keep track of different account details. The more accounts you have, the harder it can be to keep track of their details and requirements.

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Is 7 bank accounts too many? ›

The answer to this question is, however many bank accounts you need to help you achieve your specific financial goals and desired lifestyle. Do keep in mind that you don't want too many to manage as it may become a hindrance.

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Does closing a bank account hurt your credit? ›

The act of closing a bank account, such as a checking or savings account, does not directly affect your credit score. Your credit score is not directly affected by your checking and savings account activity. That includes account closures.

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How many checking accounts are 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.

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How much money can you have in the bank without being taxed? ›

Banks must report cash deposits totaling more than $10,000. Business owners are also responsible for reporting large cash payments of more than $10,000 to the IRS.

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Should I keep all my money in one bank? ›

Keeping all of your money in one bank can be convenient. But it's important to consider whether you're getting the best rates on savings and paying the lowest fees for checking accounts. It's possible that you could get a better deal by keeping some of your money at a different bank.

Can I have 8 bank accounts? ›

Yes, it is legal to open up multiple bank accounts in the US.

Get More Info Here ›

Is it good to have many bank accounts? ›

Banks offer a variety of accounts that provide different features. While it makes sense to use a checking account for your everyday money management, it's a good idea to have multiple types of bank accounts to make the most of your money.

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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