How Many Savings Accounts Should I Have?


Few would argue against the idea that everyone should have some kind of savings account. However, determining the number of savings accounts necessary for an individual depends on the purpose of saving. While there is no one-size-fits-all answer, your financial goals should guide you to decide if one or several savings accounts are right for you.

Emergency Fund

Everyone should have a basic emergency fund in an easily accessible savings account at your primary bank or credit union. This savings account is money specifically for serious emergencies, such as a car accident insurance deductible, hospital visit or sudden unemployment. You should have anywhere from three months' to one year's worth of basic expenses in your emergency fund depending upon your job security and personal circumstances.

Specific Savings Goals

You can add a separate savings account for a specific savings goal. Big ticket items like a car or house require a significant down payment ranging from a few to tens of thousands of dollars. Having a separate savings account specifically for a savings goal increases your awareness of the goal and the likelihood that you will save enough to make such a purchase. It also helps to see exactly how much you have contributed to the goal by simply checking the balance of the account.

Sinking Funds

Sinking funds are separate savings accounts in which money is deposited regularly to pay for irregular or annual bills. A great example many are familiar with is the Christmas saver account. You deposit a small amount into the account each pay period or month to be spent on Christmas presents come December. Sinking funds help you stay within your budget by allotting monthly income to predictable but irregular spending, such as insurance premiums, annual car maintenance, income taxes for self-employed and clothing purchases.


Determining how many savings accounts you should have is a highly personal matter. Factoring in your saving and spending styles is essential in deciding if you only need one general savings account or a dozen. For example, spenders might do better if they use several savings accounts for an emergency fund, savings goals and sinking funds to ensure there is enough money to pay for everything. Some savers might fare better with only one high-yield savings account. Only you can decide how many savings accounts and what kinds best suit your needs.

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