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Having too many bank accounts can make keeping track of them overwhelming.

But different accounts can help you achieve and organize your financial goals. Each account should have a purpose. Whether that’s to get a sign-up bonus, to get ATM fees waived or to separate your savings from your everyday checking.

Accounts start to add up over time. From credit cards opened up many years ago to a new 401(k) each time you join a new employer that offers one.

The goal is to have enough bank accounts to manage your finances effectively, but not to have too many accounts that makes it challenging to track.

Financial accounts, like wrinkles, proliferate as you venture further into adulthood.

Where there was once a single checking account to house your first paycheck, now there are savings accounts, money market accounts, credit cards, 401(k)s, mortgages, 529s, and maybe even a home equity line of credit (HELOC) or a health savings account.

Each new product comes with a purpose — earning a sign-up bonus, saving for your kid’s tuition, preparing for retirement — but soon you’re left with an overwhelming list of log-in IDs, passwords and interest rates. This situation is rarely ever planned, and very difficult to control.

Making sense of your constellation of accounts isn’t simply a question of finances. It also gets to the heart of your values. Should you share a checking account with your spouse, or does a marriage benefit from a bit of privacy? How much of your paycheck should you put into joint accounts, and how much into your personal accounts?

Where to start? A bank account is the lattice from which you build your personal finances, and you should, from time to time, take stock of not only where your money is located, but why it’s there.

Checking account vs. savings account

Checking and savings accounts are purposeful financial instruments that should be used for specific goals.

A checking account is the way station of your finances — money comes in from your paycheck, and exits to pay bills. A savings account is your rainy-day fund.

Financial planners recommend you hold three-to-six months’ worth of expenses as a hedge against bad stuff — like a layoff or a health scare. How much you need depends on your particular cost of living.

Amassing this cache is vitally important, and something that Americans continue to struggle with, since nearly three in 10 adults don’t have emergency savings, according to Bankrate’s June 2019 Financial Security Index.

An account shouldn’t cost you

The function of checking and savings accounts, then, is to make sure your money is in the right place at the right time.

While you should absolutely look for the highest yield possible, you should also be highly sensitive to fees. Your struggle to save shouldn’t be made that much harder by nickel-and-diming.

Even small fees can add up over time and chip away at your account balance, especially since you are inexplicably loyal to your financial institution.

Overdraft fees charge an average of $33.36, according to Bankrate’s 2019 checking account and ATM fee study , while out-of-network ATM fees cost $4.72.

Around 42 percent of non-interest checking accounts are considered free, according to the Bankrate study. This is the highest percentage of free accounts since 2011, so these accounts are becoming easier to find. The average monthly service fee on interest-bearing accounts is $15.05.

One dip into each fee bucket will cost you around $50, draining your potential savings.

How many bank accounts should you own?

The average American owns around four credit cards, according to Experian. Mortgages (54 percent) and credit cards (53 percent) are the most common debts that U.S. consumers have, according to a Dec. 2018 CreditCards.com survey.

Plus each time you change jobs, you’re likely to enroll in a new 401(k). Each new child added to your family not only brings more diapers, but another 529 plan to manage as well.

When it comes to the nuts and bolts of your bottom line, think minimalism.

“If you can open one less account, do it,” says Conrad Ciccotello, a professor at the University of Denver.

Everyone needs at least one checking account and should consider one savings account too.

Couples often maintain a joint checking and savings account for the family’s finances — mortgage payments on one hand, and the emergency fund on the other — while maintaining a separate checking account for personal expenses.

A little privacy and personal ownership will make for a less stressful experience managing your personal finances. No one wants to be hounded over relatively small purchases, especially not by your spouse.

Of course, you shouldn’t hide the existence of the account from your loving partner.

If you have a specific savings goal in mind, separate and apart from your emergency fund, open another account. A higher yielding certificate of deposit (CD) is a good avenue, and will help inoculate the funds from mindless spending.

Set up a direct deposit so the account is properly financed, and give it a name to make the savings goal more tangible, perhaps something like “Dream Vacation Fund.”

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When should you open a new account?

You should consider opening a new account if you’re not happy with your current banking relationship. With so many ways to waive fees, if you’re being charged fees you should reevaluate your banking situation.

Also, banks may come out with newer products that offer better options. Or sometimes the older accounts are better. So evaluate your options to see if a new account fits your needs.

Some banks offer bank account bonuses, usually ranging anywhere from $50-$1,000. These can be a great opportunity to earn more money.

What to look for when opening a new account

When opening a new account, one of the first things you should check into are minimum balance requirements and fees. The goal should be to find an account that won’t charge you fees. If an account does have fees, you can usually waive these by keeping a minimum balance in the account or by having a certain amount direct deposited each month.

Also look at ATM options, since you’ll probably want to access cash at some point. If ATMs are important to you, make sure your bank either has ATMs near you or that it reimburses out-of-network fees.

When not to open a new account

If it’s too difficult and time consuming to keep track of all of your accounts, that might be a sign that you have too many accounts and it’s not time to open a new one. Having too many accounts can cause you to miss fraudulent activity, be overcharged (or double-charged) for a purchase or incur other activity that costs you money.

Also, if you’re really happy with your bank it might not be time to open a new account. But even if you’re generally pleased with your bank, it’s good to see what else is available in the market. This is especially true if you’re paying fees for something that you can get for free, or waived, at another bank.

The benefits of having multiple accounts

Multiple accounts are great if you’re trying to separate money for different goals. It might be best to keep an emergency savings account or a vacation savings account separate from an account that’s used to pay everyday bills. When money is commingled, it’s easier to spend that money on purposes it probably wasn’t intended for.

Having multiple accounts is great, as long as you’re not paying too much in fees. So make sure the account either doesn’t have maintenance fees or minimum balance requirements. Or at least that you’re able to meet the requirements to get the fee waived.

Tips for opening and closing bank accounts

Research any new account before opening it. This includes reading the account agreement, disclosures or any other relevant information that can help you understand the account now to avoid problems later. Make sure you ask any questions you have before opening the account.

When you close an account, make sure you inform your bank. Simply leaving your account balance at zero could cause a domino effect of maintenance fees and overdraft fees.

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— CreditCards.com is owned by Bankrate’s parent company, Red Ventures.