General Question

janbb's avatar

Other than FDIC limits, is there any reason to use more than one bank?

Asked by janbb (54968points) February 6th, 2018

As asked.

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19 Answers

SergeantQueen's avatar

Well, if you are doing online banking and stuff having a savings account online and a checking account that isn’t online or that’s at a different bank can help save money because online banks have higher interests?

this site says that they have 4 accounts because of how much they save and for security reasons.

zenvelo's avatar

No, not really.

Homeowners that shop around for a mortagge might get a slight break for having an account at the bank that holds their note, especailly on an equity line of credit. But the interest rates on a line of credit are pretty competitive, so your bank shouldbe able to match what is offered elsewhere.

canidmajor's avatar

Temporarily, sure. For example, if you are moving from one state to another and prefer local banks (as I do), setting one up in the new place before a move is a good plan.
Otherwise, hiding assets might be a reason…:-O

janbb's avatar

@canidmajor Oh, of course. And I also set up a savings account in a new bank because they were offering a bonus. But right now I am trying to simplify some things so I am wondering whether to keep that account open. I just closed a third savings account at another bank.

Jeruba's avatar

If something goes mightily wrong and your account is frozen, you have other funds to fall back on.

It’s happened.

janbb's avatar

Good point. I do have money in an investment account I could tap though then. So I guess a minimum of two sources of funds is good.

canidmajor's avatar

Oh, I didn’t even think of that! Good points, @Jeruba and @janbb. I have an investment account in a different place, too.

YARNLADY's avatar

We open and close bank accounts at various banks regularly. We keep getting offers that say if we open an account and use it for the specified amount, they will deposit $100 into our account. We use it as directed and close it a few months after the $100 appears. i have gotten several $100 that way the past few years.

janbb's avatar

@YARNLADY Yeah, that’s why I opened the third one but I love my main bank and will never leave them.

And I’m working on simplifying things so that if something happens to me and my son needs to take charge of my affairs it’s not too messy.

Zaku's avatar

Ability to quickly/easily cash large checks from people writing checks on their accounts at another bank, and/or to avoid fees or annoying security measures at another bank in similar circumstances.

Access to branches or no-fee ATMs, particularly in different towns or states where one bank doesn’t have branches or allied no-fee ATMs.

Access to different services of a bank that are done better by one bank than another. For example, their might be a bank that you don’t prefer for some reasons, but has a service that other banks don’t have, or don’t do as well (for example, keep various foreign currencies on hand, or offer free cashiers’ checks, or whatever).

Take advantage of offers such as @YARNLADY mentioned.

As @jeruba mentioned, to deal with temporarily blocked accounts due to whatever.

janbb's avatar

@Zaku Yes, true. I do have a small BoA account for debits while traveling and because they have no foreign transaction fees.

KNOWITALL's avatar

I have multiple accounts just because of features offered, plus I keep a couple grand here and there for my peace of mind. Better than a can in the backyard, maybe lol

RedDeerGuy1's avatar

To save for long term and short term.

Jeruba's avatar

In the bad old semi-broke days, my husband worked for a Silicon Valley startup that went bust. (This is not an unusual SV story.) My husband’s final paycheck bounced—right after he had paid all the bills. Every creditor charged him a bounced-check fee when those payments got rejected. They froze his checking and savings accounts both.

We were damned glad that my modest little account was at another bank. It wasn’t much, but it got us by. It took months to untangle the mess, and we would have been in very bad shape otherwise.

We’ve maintained accounts at separate, unrelated banks ever since, not caring to find ourselves sandbagged like that ever again.

In these uncertain days, I wouldn’t think an under-the-mattress account would be a bad idea.

imrainmaker's avatar

@janbb – I think you have asked similar question before as well. Did you take those suggestions into consideration?~ JK..) There are some good reasons given in above responses!!

LuckyGuy's avatar

I like the idea of having a backup in case one of the accounts is hacked or frozen due to identity theft.
Recently we received a call from a bank’s security team asking if we had purchased parts from a motorcycle shop and had them sent overseas – 3 times in one hour! I said “no” and the account was frozen immediately. “New cards will be sent within 5 business days.”

janbb's avatar

Some people seem to take this as asking about credit cards which is not what I am asking. I do have a few credit cards.

And yes, there are good reasons given above and I do consider responses before deciding what to do.

Dutchess_III's avatar

The only reason I can think of is if you want a savings account that you don’t want to be reminded you have every time you log in online to your bank account. Stash it in another bank.

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