Should you keep all your Money with one Bank

Many people have more than you kind of bank account. Checking accounts, savings accounts, and investment accounts are just a few of the many kinds of accounts that people may have at a particular bank. However, with so many banking options and so many account options, should you keep all of your accounts in one bank or should you spread them out among the various banks?

Probably the primary reason that many people do all of their business at one bank is for convenience purposes. Many people like the convenience of conducting all of their banking business at one place and at one time. I understand this point of view because getting everything done at once and in the shortest amount of time is highly convenient for “people on the go.” However, I do not agree with these people. Essentially, these people are giving up money in exchange for convenience. I do not feel that I should give up my money for convenience especially if saving my money does not require that I “inconvenience” myself that much.

My point of view is better explained in an example. Many people use the big national banks to do their banking. You may have a checking account with such a bank. Because your bank is a big, national bank chances are good that your bank offers savings accounts. However, the problem with big, national banks is that the interest rate on their savings accounts is usually very low. In fact, I have seen as low as 0.1% (yes, that is one-tenth of one percent) for one of the biggest banks in the world. However, let us pretend that right across the street from your big, national bank branch is a small, local bank. This small, local bank offers a 4.5% savings account interest rate. Common sense may tell you that because you are getting far more interest at the small, local bank that you should open an account with it. However, many people do not think this way. Many people do not want to go with through the “hassle” of opening a new account at a new bank when their current bank will do the same thing far more quickly. Even though this may be true, I could not in good conscious deprive myself of 4.4% of interest because I would have to open a new account. Others feel differently.

Another reason that people like to do all of their banking at one bank is because there is less to worry about. When you receive your bank statement (whether by regular mail or through e-mail) all of your accounts should be on it. If, however, you have more than one bank, your accounts will be spread out among various statements. As such, it may be more time consuming to have to peruse two statements instead of one. Once again, I understand this argument but do not agree with it. Simply put, if you are an organized person, this will never be a problem.

Ultimately, the choice as to whether or not to spread your accounts across various banks is up to you. If you want to make and save the most money, you should use the bank that offers the best interest or that has the lowest fees for the product in which you are interested. If, however, you are searching for convenience, the best thing you can do is keep all of your accounts in the same institution.