One of the most crucial steps towards beginning with financial planning is to sketch your financial goals. These goals essentially help you decide which investment options to go for, mutual funds, FDs, savings accounts, among others. However, there are multiple opinions surrounding the use of accounts and how many accounts are ideal to maintain in order to streamline your financials. If you can organise and handle your savings account well, multiple accounts can help you immensely with the structuring of your financials. Let’s find out how.
Save for multiple goals
Multiple savings accounts can help you save for your short-term goals. Often, when you have just one account, that too your salary account, it gets difficult to actually save for a goal. This is when an additional account comes in handy. To all additional accounts, assign a goal and accordingly deposit money needed to meet that goal. This way you won’t be able to exhaust your resources and simultaneously save intelligently. When you open a second account, ensure that you only deposit money and not withdraw from it, unless you are broke or it’s absolutely necessary. Also, the other savings account should ideally give high yields, so that you make the most out of your savings.
Create an emergency fund
One of the best uses of maintaining multiple funds is to serve the purpose of creating an emergency fund. Assign the role of emergency account to one of your savings accounts. To this account, transfer a specific amount at the start of every month via standing instruction to your salary account. An emergency account will help you sail through tough times, and will give you the financial cushion at times of need.
Avail the perks offered by various banks
Various banks in India offer you different interest rates and different perks. Having multiple bank accounts gives you the ease to avail the best of each bank. For example, often holding a savings account with a particular bank and maintaining a good banking relationship can help you avail a home loan from the bank with relative ease. There are banks that offer cash back facilities on purchases as well as customer loyalty features like reward points etc. that you can avail from each of the bank that you have an account with.
Things to keep in mind
While opening several accounts comes with its own set of perks, it can easily turn into a bane. So be systematic and handle your accounts well. With every job change you might need to open a new salary account. So keep a tab on the number of accounts (3-4 is a good number, anything more than this might become difficult to manage) that you have and close the accounts that are no longer functioning. Also, non-operational accounts can easily draw the attention of fraudsters and you might have to deal with the hassles of handling the consequences. So if you have way too many accounts, they can soon become a liability, so take the time out and close the accounts that are inactive or dormant.
1 Comment Comments
This is actually useful, thanks.