Multiple Bank Accounts - 8 Benefits of Opening Multiple Bank Accounts

Nowadays, many people are opening multiple bank accounts due to various reasons, be it a job switch or for business purposes. However, the fundamental benefits of having multiple savings accounts are still in question. So, let's delve deep into the matter and discover some of the advantages that opening multiple bank accounts can have.

Save Money for Various Short-Term Goals

Often, when all you have is a salary account, it gets difficult to actually save money. Having an additional account can be of real help in this regard.  You can assign a goal to each account that you have and deposit money in them accordingly. Let’s discuss this with an instance - Say you are a travel enthusiast and wish to go on a foreign trip every year. So, you can open an account dedicated to that purpose and save a certain amount of money in it every month. Multiple bank accounts can thus help you save money diligently for short-term goals; however, make sure that you use the second account only for storing money, and keep yourself from withdrawing it unless entirely unavoidable.

Open Multiple Need-Based Accounts to Track Your Money

Nowadays, the government offers several services to different sections of people, under which you could get a subsidy in your account. For example - Under the Direct Benefit Transfer (DBT) scheme, the government transfers money as subsidies for LPG gas directly into your savings bank account if you come under a certain bracket, and there are around 400 more such schemes. Hence, it is beneficial to have a separate account for these subsidies. Likewise, you can have a separate account linked with your income tax returns, where you can receive refunds as and when applicable for you. If you are a pensioner, then it is better if you receive your pension in a dedicated account, as it makes tracking the funds easy.

Thus, it can be advantageous for you to maintain multiple bank accounts based on your different needs.

Keep Your Options Open

Having multiple bank accounts could also help you get through certain unforeseen circumstances. In case you face technical difficulties during a transaction from one of your bank accounts, you can always fall back on another account of yours to get it done. This can prove to be helpful especially in case of emergencies, and you will not be left without any options when you hit an unexpected roadblock.

Create an Emergency Fund

Dedicate an account exclusively to saving for an emergency. At the start of every month, transfer a specific amount of money to this account through a standing instruction to your salary account. An emergency fund will help you sail through tough times by providing you with a financial cushion at times of need.

Avail Different Perks from Multiple Banks

Different banks in India offer distinct interest rates and perks. Having multiple bank accounts gives you access to the best of such benefits. Holding a savings account in one bank and maintaining a good relationship with it could help you in availing a home loan with relative ease. Whereas, some other banks may offer higher interest rates on savings accounts. You may be eligible for rewards, exclusive facilities, and bonuses at other banks. Thus, the sheer variety of benefits offered by different banks makes it a good idea for you to hold accounts in many of them.

Avoid ATM Transaction Charges

Banks allow five free transactions from their own ATMs and three from ATMs of other banks. After these eight transactions, the bank starts charging you if you use an ATM with the same debit card. However, if you hold debit cards of two bank accounts, then, you can make up to 16 free transactions in a month.  

Avail Free Cheque Books

Usually, a bank offers only one free checkbook in a year. If you request for another checkbook in that financial year, the bank will charge you. However, If you have two bank accounts, then you can avail of two free checkbooks in a year.

Increase Your Credit Card Limit

Nowadays, banks often offer a credit card when you open an account with them. So, if you have two different bank accounts and credit cards issued from both of them, then the amount of credit that you can use will increase.

What is a PayDay Loan ? - When Does A Payday Loan Typically Mature?

Payday loans are actually short-term loans. These are typically taken when one has an emergency situation. Imagine you are in a tight spot, such as if one of your family members needs to be hospitalized and you are still waiting for the next paycheck.

Quite a problem, right? Well, getting a paycheck loan mitigates this problem. The disbursal and documentation process is faster in comparison to other personal loans.

However, the biggest downside to payday loans is that these come with very high interest rates. So, before you sign up for one, do be sure that you understand all the risks and costs involved.

When does a payday loan mature?

You may be wondering when a payday loan matures. We understand that you are asking this question with other typical personal loans in mind. Well, in the case of these loans, the maturity date is one of the shortest in the personal loan category.

To tell you what actually happens, let’s give you a little example. Let’s say that you need Rs. 50000 urgently. You get a payday loan and promise to repay as soon as you get your next paycheck or salary. When you do get that next month or so, you repay the loan, with interest.

But as said above, the interest here can be quite high. Make sure you can repay the loan. It is very easy to fall into a debt trap in which you keep on paying the interest without being able to see the end of the loan.
How much do payday loans give you?

This depends on the lender, but don’t count on getting a lot of money. How much money you get depends on your salary. If your salary is high, you may get high loan amounts, otherwise not.

Check with the lender how much they are able to give. If your situation is dire, ask them for a custom service, but know that the interest rate can be even higher because of it. You repay it as soon as you get the next paycheck. There are lenders who have loan terms of just a couple of weeks.

These are unsecured loans. The interest is quite high and if you cannot repay it at the due date, you can roll it over sometimes to extend the term. This means that you won’t have to repay it there and then, but you’ll have to keep repaying the fees. As you can understand, this is quite risky for the borrower as well. It all depends on your capacity to repay.
How expensive are they?

These loans are significantly more expensive than other personal loans. If you do feel that payday loans are too risky for you, think about other personal loan options like gold loans. Payday loans typically come with a very high APR, sometimes as much as 500%.
The good side of payday loans

One of the biggest benefits of payday loans is that you don’t need to show a credit score to get it. You don’t even need a credit history, bringing this loan type into the hands of most people, especially those facing emergency situations and financial difficulties.

8 Benefits of Opening Multiple Bank Accounts - Multiple Bank Accounts

 Nowadays, many people are opening multiple bank accounts due to various reasons, be it a job switch or for business purposes. However, the fundamental benefits of having multiple savings accounts are still in question. So, let's delve deep into the matter and discover some of the advantages that opening multiple bank accounts can have.

Save Money for Various Short-Term Goals

Often, when all you have is a salary account, it gets difficult to actually save money. Having an additional account can be of real help in this regard.  You can assign a goal to each account that you have and deposit money in them accordingly. Let’s discuss this with an instance - Say you are a travel enthusiast and wish to go on a foreign trip every year. So, you can open an account dedicated to that purpose and save a certain amount of money in it every month. Multiple bank accounts can thus help you save money diligently for short-term goals; however, make sure that you use the second account only for storing money, and keep yourself from withdrawing it unless entirely unavoidable.
Open Multiple Need-Based Accounts to Track Your Money

Nowadays, the government offers several services to different sections of people, under which you could get a subsidy in your account. For example - Under the Direct Benefit Transfer (DBT) scheme, the government transfers money as subsidies for LPG gas directly into your savings bank account if you come under a certain bracket, and there are around 400 more such schemes. Hence, it is beneficial to have a separate account for these subsidies. Likewise, you can have a separate account linked with your income tax returns, where you can receive refunds as and when applicable for you. If you are a pensioner, then it is better if you receive your pension in a dedicated account, as it makes tracking the funds easy.

Thus, it can be advantageous for you to maintain multiple bank accounts based on your different needs.
Keep Your Options Open

Having multiple bank accounts could also help you get through certain unforeseen circumstances. In case you face technical difficulties during a transaction from one of your bank accounts, you can always fall back on another account of yours to get it done. This can prove to be helpful especially in case of emergencies, and you will not be left without any options when you hit an unexpected roadblock.
Create an Emergency Fund

Dedicate an account exclusively to saving for an emergency. At the start of every month, transfer a specific amount of money to this account through a standing instruction to your salary account. An emergency fund will help you sail through tough times by providing you with a financial cushion at times of need.
Avail Different Perks from Multiple Banks

Different banks in India offer distinct interest rates and perks. Having multiple bank accounts gives you access to the best of such benefits. Holding a savings account in one bank and maintaining a good relationship with it could help you in availing a home loan with relative ease. Whereas, some other banks may offer higher interest rates on savings accounts. You may be eligible for rewards, exclusive facilities, and bonuses at other banks. Thus, the sheer variety of benefits offered by different banks makes it a good idea for you to hold accounts in many of them.
Avoid ATM Transaction Charges

Banks allow five free transactions from their own ATMs and three from ATMs of other banks. After these eight transactions, the bank starts charging you if you use an ATM with the same debit card. However, if you hold debit cards of two bank accounts, then, you can make up to 16 free transactions in a month.  
Avail Free Cheque Books

Usually, a bank offers only one free checkbook in a year. If you request for another checkbook in that financial year, the bank will charge you. However, If you have two bank accounts, then you can avail of two free checkbooks in a year.
Increase Your Credit Card Limit

Nowadays, banks often offer a credit card when you open an account with them. So, if you have two different bank accounts and credit cards issued from both of them, then the amount of credit that you can use will increase.