Why Opening Multiple Savings Account is Useful?

Effective money management is more critical than ever in today's rising inflation. One practical strategy that many people find beneficial is opening multiple savings accounts. While having more than one account might seem excessive, there are several compelling reasons why this approach can be incredibly useful for managing finances. This blog explores the key benefits of maintaining multiple savings accounts.

Here’s why you should open more than one Savings Account:

1. Tracking Goals

You can more effectively monitor your progress by allocating funds into separate savings accounts dedicated to specific goals, such as travel, emergency funds, or education. Each account can be tailored to track and achieve different financial objectives, making managing and evaluating how much money is saved for each purpose easier.

2. Encourages Saving

Automating transfers to different savings accounts ensures that a portion of your income is consistently saved before you can spend it. This system helps mitigate the temptation to spend impulsively by systematically diverting funds into savings, thus maintaining discipline and improving your overall financial management.

3. Meeting Financial Goals

Maintaining multiple savings accounts can provide a structured approach to achieving financial goals. It allows you to track the progress of each goal individually, monitor how well you are sticking to your saving plan, and stay motivated. This setup helps reinforce accountability and provides a clear view of how your savings contribute to long-term financial success.

4. Flexible Card Usage

If your debit card is subject to a daily withdrawal limit, having multiple savings accounts ensures you can access funds when needed. In emergencies or when the limit on one account is reached, you can withdraw cash from another account, providing a buffer and greater flexibility in managing urgent financial needs.

Here’s how you can allocate your money across different Savings Accounts: 

1. Main account

You should have one main account, which will be your primary account for major monthly expenditures. This account can be linked to all your EMI payments, rent, mutual fund investments, monthly shopping, and other automated bill payments. 

2. Salary account

You should have a separate account to receive your monthly salary. This can also be a temporary account, which you can consider closing when you change your job. You can regularly transfer a certain amount from this account to your main account to meet investments and expenses. 

3. Joint account

A joint account between spouses formulates comprehensive knowledge about financial assets. You can use this account for 3-6 months’ contingency funds. The nominee of such an account can be your children. 

While there’s no limit to how many Savings Accounts you can have, there are a few things to consider before signing up for more than one. 

• According to financial experts, opening more than three Savings Accounts is not advisable, as it is difficult to manage. 

• Apart from having a minimum balance in each account, banks might also mark an account dormant if there is no activity for a period of time. 

• Banks may also levy various charges on these accounts, and if you are keeping them idle, the balance will decrease unnecessarily.
   

The money in each account depends on your comfort level. While it should be sufficient to have a good night's sleep, it shouldn't tempt you to splurge. It isn't uncommon for bank balances to stagger just before your salary arrives, making it essential to have a decent balance to fund an emergency or unexpected expense. 

The advantage of having multiple accounts is that it allows you to prioritise your financial goals and save more effectively. At HDFC Bank, you will find a Savings Account tailored to meet all your needs.

While there is no limit to how many  Savings Accounts  you can have, there are a few things to consider before signing up for more than one.

To keep up with the current times, HDFC Bank has extended an instant Savings Account facility via InstaAccount, ensuring a completely paperless account opening process. You only need a few minutes to enter your details and upload your documents. 

Click here to open a new  Savings Account  digitally. 

Want to know more about opening a contactless  Savings Account ? Click here to get started.

Click here  to open a Savings Account.

*Terms and conditions apply. The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.