Deciding whether you should have all your money in one bank or single financial institution is difficult. On the one hand, you have the convenience and loyalty perks that staying with a single place offers, but on the other hand, you have the perks of different businesses working with your money. In truth, it all comes down to your financial situation and personal preference, but it can go either way.
The Benefits of a Single Financial Institution
To answer the question, it helps to first look at the benefits of having one singular account to hold your financial interests. Of course, not all of these will be applicable to every single situation, but they are all things that should be considered when thinking about a long-term financial strategy.
Loyalty Costs (Need $20,000 in most)
Firstly, financial institutions almost always have in place the facilities for rewarding loyalty, and they come in a lot of different forms too. Many for example will remove recurring fees if you have an agreed income every month and your account stays consistently above a certain balance. They may well also give you priority access to low-cost loans or mortgages even, should you meet certain criteria. When you work with a single financial provider, you know exactly how close or far you fall from meeting this criteria, and have the best chance at reaching the standards.
Trackability
Managing multiple accounts can be difficult, but having everything at a single financial institution means that you have an ample set up to keep everything easy to track. However you like to store your money, you’ll be able to track your money more easily with minimal accounts that all likely use the same log-in credentials. That’s especially apparent for things like apps and online banking with the security of banking tools being so high and making log in details potentially difficult to remember across accounts.
Convenience
There’s also of course the convenience that comes working with a single financial institution as well. Whether it means you only need to make one trip to the physical location whenever you have to, or that you only need to carry one or two cards in your wallet, it can be a major time saver. That’s amplified when it comes to changes in your life that you may need to inform your financial provider about like changes of name, address, or even financial situation.
The Disadvantages of a Single Financial Institution
Just because using a single place to manage all of your financial interest has benefits, it doesn’t necessarily mean it’s the best course of action. Again, of course, it depends on the individuals financial situation, their interests, and how they prefer to manage their money, but having accounts spread across multiple institutions does mean there can be more perks than just the one, especially if managed smartly.
Mix of Perks
First, it’s important to consider the mix of perks that come alongside having your money in different accounts. Financial institutions can have benefits that come in all kinds of shapes and sizes. It may be better rates on their financial products, different monthly fees, cashback, ATM charges, promotions, or just about anything else you can think of.
Providing you’re not spread so thinly that you don’t qualify for as many benefits as you could, having multiple accounts at different places can have a lot of advantages.
Self-Sabotage Reduction
Another, more unsung perk to having accounts in different places is that it becomes more difficult to borrow money from yourself. Self-sabotage is one of the biggest obstacles to avoid when it comes to money management and saving in particular. It’s a lot easier to move money from savings to an everyday account when they’re with the same bank than when they aren’t. That can be a big help.
Bank Failure Risk Reduction
There’s also the fact that having multiple financial institutes working with your money means that your financial security is stronger than it would be if that was not the case. Multiple accounts help to spread the risk should a single place ever collapse, which is possible at any time when all things are considered. This added security is difficult to argue with and is one of the main reasons people tend to take this route.
The Takeaway
Ultimately, it all comes down to the individual as to whether they should use one or multiple places for their financial accounts, but generally, having multiple accounts spread out among different financial institutions is the better route, provided the accounts will have sufficient funds to be able to claim multiple benefits. Cashero is a great option if you’re looking to diversify where you save your money. You can earn up to 5% APY and be at ease knowing your money is in safe hands.
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As of the date of publication, the information contained on this page is deemed to be factually accurate for all terms of conditions, features, and fees. Changes made to Cashero’s terms of conditions, features, or fees after the publication of this content may not be accounted for.
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