When it comes to managing money, everybody likes to share their own two cents. One frequently discussed money-management topic is deposit accounts: with how many banks should you have deposit accounts? The answer is just one. If you want to save your money and simplify your finances, then consolidating deposit accounts at one bank is your best move. Why?
Here are some of the benefits of consolidating deposit accounts at one bank:
Sometimes, the most compelling reason to do something is to learn all the bad things that will happen if you don't. So, before we talk about the advantages of consolidating deposit accounts at one bank, let's discuss the chief disadvantages of having multiple accounts at multiple banks.
It may seem like a good idea to open multiple accounts at multiple banks because it spreads out your savings; however, it is for this very reason that working with multiple banks is actually disadvantageous.
When your money is scattered across multiple banks, it's hard to keep track of all of your financial activity. As a result, you may accidentally forget about an outstanding balance somewhere, bounce a check, or be subjected to overdraft fees.
Working with multiple accounts across multiple banks is just too complicated, and you are more likely to make financial mistakes because of it.
Similarly, while having multiple accounts at multiple banks makes it harder to manage your finances, it makes it far too easy to spend your money. According to a study from Men's Health, people who keep all of their money in one place actually spend less money than those who don't - 10% less.
Himanshu Mishra, Ph.D., associate professor of marketing at Utah's David Eccles School of Business, explains why: “When all of your money is in one account, you're aware of exactly how much dough you have. If you spend any of it, the dollar total in your head and in your account goes down.”
If you want to cut spending, scattering accounts all over the place isn't the way to do it. Instead, keep your savings organized in one bank so you can remain conscious of your money and your spending habits.
It's clear that opening multiple accounts at multiple banks can be overwhelming. To streamline your finances and spend less time stressing over bank statements, consider keeping all of your deposit accounts at one bank.
Not only will you save time and effort by visiting just one bank instead of many, you'll also reduce the number of statements and tax forms you receive each year, and you'll cut back on the number of confusing passwords and log-ins you need to remember.
It may seem like common sense, but sticking with just one bank will greatly simplify your banking experience. After all, aren't finances already complicated enough?
Another reason to keep all of your accounts with one bank is that there are many perks to be hand when you go exclusive with your finances.
For example, you may get higher interest rates on savings accounts and lower rates on loans; you may even qualify for reduced or no closing costs on mortgages.
Moreover, when you work with a bank exclusively, they may be more likely to waive fees for you, such as a safety deposit box fee, minimum balance fees, direct deposit fees, or other transaction requirements.
Perhaps the chief reason to consolidate all of your deposit accounts at one bank is that it allows you to build a relationship with your bank. This makes it much easier to communicate with your bank about managing your finances.
For instance, you can have one trusted person, or group of persons, who is familiar with all of your account details and can expertly help you manage them - rather than trying to get advice from lots of different people at different places who barely know you at all.
At BankRI, we build a relationship with all of our customers to help them best manage their finances.
We are a community bank made of up of Rhode Islanders, serving Rhode Islanders.
When you bank with us, you will enjoy the benefits of consolidating your deposit accounts at one bank: easy management, special perks, and a trustworthy relationship.
Visit BankRI to learn more.