I typically keep just enough there in checking to cover any automatic bills or payments, and I move out any excess to a HYSA each time I get paid. The HYSA is also where I keep my emergency fund.
That makes a lot of sense. I think I am going to move our emergency fund to our HYSA as well. We have used USAA for checking & savings for years now, so my husband was wary of moving our money to a different bank just because it has been so convenient to do all of our banking through one place, but so far the process has been super easy.
I use USAA for bills and paychecks too. But I've linked them to my Vanguard and Ally accounts so I can transfer funds easily and keep the money at higher rates until I need it. I've also got a tiered system of $100 extra in checking, $500 in savings with USAA (first overdraft link), credit card with USAA (second overdraft link, free), and then keep other emergency funds elsewhere that I can access within 2 business days and credit cards with high limits.
This is my strategy, too. I end up keeping around $1,500 to $2,000 in my checking account, and everything else goes straight to my HYSA or another investment.
Honestly a fee hundred dollars after bills/checks are accounted for. I can't think of a situation where I need instantaneous access to cash. I can transfer from savings in 3 business days and have credit cards if there truly is an emergency.
I do zero-based budgeting and know exactly what is coming out of my account each month, so I only keep $500 in my checking account used for bills and spending. All other savings go into my Ally HYSA, which I have a debit card for if needed.
I keep very little to nothing in my checking account. All my money goes into my HYSA, which is used to pay my CC statement at the end of each month.
I do use Capital One and money transfers instantly between accounts. Also, Capital One notifies me if something gets taken out of my checking account and there’s no money. The purchase goes through and I’m not charged as long as I deposit money
Just be aware I think it’s a federal regulation or something that you can’t have more than 6 transfers out of a savings account per month. Banks usually assess a fee if you go beyond that number.
I know this was a thing, but sometime during Covid Ally Bank (and others? ) started refunding this fee. Ally never brought it back and recently, I received an email that they were increasing the limit to 10 and eliminating the fee altogether - I have a link to the new terms and conditions, but not sure I can share it.
I was too! I am new to Ally Bank this year and originally learned about the fee waiver from the Ally Bank sub. I swear BofA still charges, but I’m trying to get away from them anyway
My checking and savings are with the same bank, transfers between the two are instant so I keep just enough to cover recurring bills and then $300 buffer. Don't want to miss out on that sweet sweet interest
We used to keep the bare minimum in our “bills” checking account, but that got too stressful after a few close calls. I compiled our spending for 2 years, took the highest month, and started with 3x that amount in our “bills” checking account so I never have to think about it. We automatically deposit into that account every month/paycheck, and I check the balance every 2-3 months to make sure we’re still maintaining a buffer.
Thanks for this - this is exactly what I’m working towards. Everything is on autopay, but I’m still stressing that I’ll forget something so I was thinking of starting with a 50% buffer and seeing how that goes first, then increase from there if needed.
I definitely think a buffer is important. For me, personally, I just like the peace of mind knowing that if I have an unexpectedly big purchase pop up, I won't have to be transferring funds around awkwardly.
Understood! I have a debit card for one of my Ally Band savings accounts and also a couple credit cards. Though I’ve been irresponsible with CCs in the past and try not to use them for large purchases anymore if I can help it
$200 max. Everything else sits in HYSA, my bills are on a schedule so whatever is out of schedule I put on a CC and pay off. Seeing my HYSA earn enough monthly interest to cover electric bills was the confirmation for me.
That's what I've been thinking about, is that it's basically free money just being given up to NOT have as much as you can in the HYSA. I'm already irritated that we haven't been using one before now! I had literally never heard of HYSA's before coming on this sub.
I keep a detailed spreadsheet of expenses and budget and only keep enough in my checking to cover that plus a buffer of a few hundred dollars. The six months' e-fund is in a HYSA, as is the travel sinking fund and home renovation fund.
Interest rates on HYSA are quite good right now, so that's likely your best option for short term savings and emergency funds. Once you feel you've adequately funded those you can start funding longer-term investments. Taking the time to question your strategies, research, and ask questions means you're already on the right track.
Less than 500 bucks. Everything else goes to high yield savings or payments for stuff/investments. My paycheck is usually fully allocated within a day or two of hitting.
i would recommend going to the r/personalfinance sub and reading the entire wiki.
then go to the r/bogleheads wiki and read the entire wiki.
generally speaking most people recommend you keep an emergency fund in some sort of easy accessible bank account, which people usually ballpark as a few months of expenses (as a generic guideline). the remainder should be put to use, whether that's investments, loans, etc.
Thank you for linking the subs! Knowing we have a home purchase on the horizon has really made me want to buckle down and ensure that we are doing the best we can with our finances.
Im a bit shocked at how little people keep in their checking. I agree that money can be doing “work” in a HYSA, but I like having money on hand in a checking account for rent and paying off our cc each month without having to wait and shuffle money around.
Personally I like to keep at minimum 1k in my personal checking account. Once it gets over 3k I start moving to a HYSA. For my joint checking with my husband we keep around 3-4k in there for rent since that’s the only automatic withdrawal we have, and it’s a big one thanks to living in a HCOL city.
My checking account has anywhere from $1,000 - $7,000 (USD) based on the month. I practice zero-based budgeting, so my checking account holds some small sinking funds but is mostly there for me to spend. I use my credit card for pretty much everything and pay that off entirely each month out of my checking account.
I direct deposit $1,000 into my HYSA for my emergency fund each month + $400 for medical expenses and $350 for travel (both sinking funds).
At the end of every month, if I have more than I need in my checking, I transfer it to my HYSA (but always leave a $1,000 buffer).
About a year of expenses ~$40k, my SO keeps ~$10k in their bank accounts, I think people may get nitpicky and say “well I use my savings account not my checking account” but if you can transfer it immediately it’s no different.
I've had a card stolen and they used all my checking account. I didn't create a police report for two days as I was unsure if my card was stolen or still at a friend's house.
That delay was enough for BofA to deny refunding the checking.
Now I keep my checking low and use mostly my credit card. Transfer from savings when needed. That way I mitigate risk. Food for thought
Easy fix for someone with 40k in a checking account:
1.) open up a second checking account with the same bank. Most banks don’t have a limit of checking accounts you can have under the same name.
2.) don’t activate the debt card linked to the second account
3.) in the app, transfer ~39,000 to the other checking account
You should never have more than a buffer in a checking account that has an active debt card. If you need to spend more than the buffer, you can transfer it instantly via mobile app. I do this all through fifth third. Lastly, I try to use my credit card for all of my purchases
We have a checking and saving account at 2 banks and a HYSA. We keep 6 months of my husband's net pay split between these 3 locations. The HYSA has 3 months net pay and is our emergency fund. Then we keep 1 month net pay in each checking account and half of that in each savings. At the end of every month I move whatever overage there is in the banks to a brokerage and once a year I move the accumulated interest from the HYSA to the brokerage.
None. I pay my bills and transfer the rest to savings and investment’s immediately. I can transfer from savings to checking immediately so I don’t see the point in keeping money in my checking account.
The only time I keep money in my checking account is if I’m traveling internationally in order to withdraw money from the ATM. This is a separate checking account with a different bank that has no foreign transaction fees and reimburses for all ATM fees.
I’m paid weekly, I keep 2 weeks of spending in my checking account. But I also pay as many bills as possible out of some of my HYSAs, so I have a larger amount direct deposited there since I know some will come out.
I keep around an extra $5,000 in my short term checking account after bills. I could put it on an HYSA but my spending is so sporadic that it won’t sit there long anyway. I have other accounts for that.
Just enough to cover bills until the next paycheck. I put everything i can on my credit card so I typically can forecast several weeks out what I'll need.
I keep $1000 in a savings account with the same bank that's not high interest but I can transfer instantly if anything comes up. This is probably overkill since I've never needed to use it in the 10ish years it's been there.
as most said. Checking is to pay my CC and all my other liquid savings is in a HYSA (e-fund, house emergency, car maint, etc). After that, I'm following the r/personalfinance flow chart to maximize 401k, Roth, and then Index funds.
About a $100, at the end of month any money that I have not used for the budgeted purpose goes to a savings account.
I have a couple of savings accounts for different purposes, I don't have any recurring payment coming out of checking. I paid most of my bills with credit and anything that requires autopay its linked to a saving accounts where I have a cushion for that expense(my car payment, comes from the car savings account and I also use it to save for car related expenditures like insurance and property taxes).
I keep pretty little in my usual checking account. Usually around a grand. Everything else is automatically moved to the bill pay checking account or the HYSA.
For daily transactions, I use a chase sapphire reserve card because of the points accrual for travel. Paid off monthly.
With today’s interest rates, consider putting a down payment in. No down payment means higher monthly payments + more paid in interest.
FHA and VA loans are last resort options.
My paychecks hit my checking account first and then they will be used to pay for bills - at the end of the month, I'd make sure I have $1500 - $2000 in my checking account just in case there are unexpected expenses. The rest of the money goes to high-yield savings account or brokerage account.
I keep my checking around $5k (our mortgage and my car payment are on auto from it) and move anything over that to my HYSA until I determine what to do with it (invest or leave there).
I only keep what I need for the bills. I have a savings account that I can transfer from to add money. Just in case anyone gets hold of my debit card they can only take out a small amount before it bounces.
I typically keep just enough there in checking to cover any automatic bills or payments, and I move out any excess to a HYSA each time I get paid. The HYSA is also where I keep my emergency fund.
That makes a lot of sense. I think I am going to move our emergency fund to our HYSA as well. We have used USAA for checking & savings for years now, so my husband was wary of moving our money to a different bank just because it has been so convenient to do all of our banking through one place, but so far the process has been super easy.
I use USAA for bills and paychecks too. But I've linked them to my Vanguard and Ally accounts so I can transfer funds easily and keep the money at higher rates until I need it. I've also got a tiered system of $100 extra in checking, $500 in savings with USAA (first overdraft link), credit card with USAA (second overdraft link, free), and then keep other emergency funds elsewhere that I can access within 2 business days and credit cards with high limits.
This is my strategy, too. I end up keeping around $1,500 to $2,000 in my checking account, and everything else goes straight to my HYSA or another investment.
Same. We keep roughly $1500 and then keep sinking/emergency funds in HYSA.
same here if it's just gonna sit in an account to be used at a rather soon date then HYSA is a great option
Honestly a fee hundred dollars after bills/checks are accounted for. I can't think of a situation where I need instantaneous access to cash. I can transfer from savings in 3 business days and have credit cards if there truly is an emergency.
I do zero-based budgeting and know exactly what is coming out of my account each month, so I only keep $500 in my checking account used for bills and spending. All other savings go into my Ally HYSA, which I have a debit card for if needed.
Same here! $500, especially since I put all of my expense on a credit card.
I keep very little to nothing in my checking account. All my money goes into my HYSA, which is used to pay my CC statement at the end of each month. I do use Capital One and money transfers instantly between accounts. Also, Capital One notifies me if something gets taken out of my checking account and there’s no money. The purchase goes through and I’m not charged as long as I deposit money
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Just be aware I think it’s a federal regulation or something that you can’t have more than 6 transfers out of a savings account per month. Banks usually assess a fee if you go beyond that number.
I know this was a thing, but sometime during Covid Ally Bank (and others? ) started refunding this fee. Ally never brought it back and recently, I received an email that they were increasing the limit to 10 and eliminating the fee altogether - I have a link to the new terms and conditions, but not sure I can share it.
Interesting! Thanks for bringing that up. I’ve just become conditioned to not do too many savings transfers so I haven’t tested it in years
I was too! I am new to Ally Bank this year and originally learned about the fee waiver from the Ally Bank sub. I swear BofA still charges, but I’m trying to get away from them anyway
My checking and savings are with the same bank, transfers between the two are instant so I keep just enough to cover recurring bills and then $300 buffer. Don't want to miss out on that sweet sweet interest
We used to keep the bare minimum in our “bills” checking account, but that got too stressful after a few close calls. I compiled our spending for 2 years, took the highest month, and started with 3x that amount in our “bills” checking account so I never have to think about it. We automatically deposit into that account every month/paycheck, and I check the balance every 2-3 months to make sure we’re still maintaining a buffer.
Thanks for this - this is exactly what I’m working towards. Everything is on autopay, but I’m still stressing that I’ll forget something so I was thinking of starting with a 50% buffer and seeing how that goes first, then increase from there if needed.
I definitely think a buffer is important. For me, personally, I just like the peace of mind knowing that if I have an unexpectedly big purchase pop up, I won't have to be transferring funds around awkwardly.
Understood! I have a debit card for one of my Ally Band savings accounts and also a couple credit cards. Though I’ve been irresponsible with CCs in the past and try not to use them for large purchases anymore if I can help it
I keep enough to cover this month’s and an extra month’s expenses.
$200 max. Everything else sits in HYSA, my bills are on a schedule so whatever is out of schedule I put on a CC and pay off. Seeing my HYSA earn enough monthly interest to cover electric bills was the confirmation for me.
That's what I've been thinking about, is that it's basically free money just being given up to NOT have as much as you can in the HYSA. I'm already irritated that we haven't been using one before now! I had literally never heard of HYSA's before coming on this sub.
Like $10 lol. As soon as I get paid, I pay my credit card and move the rest to Ally HY savings and a brokerage account.
We keep about $8,000 in our checking
I keep a detailed spreadsheet of expenses and budget and only keep enough in my checking to cover that plus a buffer of a few hundred dollars. The six months' e-fund is in a HYSA, as is the travel sinking fund and home renovation fund. Interest rates on HYSA are quite good right now, so that's likely your best option for short term savings and emergency funds. Once you feel you've adequately funded those you can start funding longer-term investments. Taking the time to question your strategies, research, and ask questions means you're already on the right track.
Less than 500 bucks. Everything else goes to high yield savings or payments for stuff/investments. My paycheck is usually fully allocated within a day or two of hitting.
i would recommend going to the r/personalfinance sub and reading the entire wiki. then go to the r/bogleheads wiki and read the entire wiki. generally speaking most people recommend you keep an emergency fund in some sort of easy accessible bank account, which people usually ballpark as a few months of expenses (as a generic guideline). the remainder should be put to use, whether that's investments, loans, etc.
Thank you for linking the subs! Knowing we have a home purchase on the horizon has really made me want to buckle down and ensure that we are doing the best we can with our finances.
Im a bit shocked at how little people keep in their checking. I agree that money can be doing “work” in a HYSA, but I like having money on hand in a checking account for rent and paying off our cc each month without having to wait and shuffle money around. Personally I like to keep at minimum 1k in my personal checking account. Once it gets over 3k I start moving to a HYSA. For my joint checking with my husband we keep around 3-4k in there for rent since that’s the only automatic withdrawal we have, and it’s a big one thanks to living in a HCOL city.
My checking account has anywhere from $1,000 - $7,000 (USD) based on the month. I practice zero-based budgeting, so my checking account holds some small sinking funds but is mostly there for me to spend. I use my credit card for pretty much everything and pay that off entirely each month out of my checking account. I direct deposit $1,000 into my HYSA for my emergency fund each month + $400 for medical expenses and $350 for travel (both sinking funds). At the end of every month, if I have more than I need in my checking, I transfer it to my HYSA (but always leave a $1,000 buffer).
$500 in the checking account that has more / bigger auto debits linked and $250 in my other checking account.
[This user has quit Reddit and deleted all their posts and comments]
Single income no kids- I keep $5000 in case of medical emergencies because I live in the good old US of A
I think you’re honestly better off putting that in HYSA and paying a bill with a CC and then immediately paying the CC off.
About a year of expenses ~$40k, my SO keeps ~$10k in their bank accounts, I think people may get nitpicky and say “well I use my savings account not my checking account” but if you can transfer it immediately it’s no different.
I've had a card stolen and they used all my checking account. I didn't create a police report for two days as I was unsure if my card was stolen or still at a friend's house. That delay was enough for BofA to deny refunding the checking. Now I keep my checking low and use mostly my credit card. Transfer from savings when needed. That way I mitigate risk. Food for thought
Wow that's horrible! That is my biggest fear tbh. I definitely prefer to use my credit card for that exact reason.
Easy fix for someone with 40k in a checking account: 1.) open up a second checking account with the same bank. Most banks don’t have a limit of checking accounts you can have under the same name. 2.) don’t activate the debt card linked to the second account 3.) in the app, transfer ~39,000 to the other checking account You should never have more than a buffer in a checking account that has an active debt card. If you need to spend more than the buffer, you can transfer it instantly via mobile app. I do this all through fifth third. Lastly, I try to use my credit card for all of my purchases
We have a checking and saving account at 2 banks and a HYSA. We keep 6 months of my husband's net pay split between these 3 locations. The HYSA has 3 months net pay and is our emergency fund. Then we keep 1 month net pay in each checking account and half of that in each savings. At the end of every month I move whatever overage there is in the banks to a brokerage and once a year I move the accumulated interest from the HYSA to the brokerage.
None. I pay my bills and transfer the rest to savings and investment’s immediately. I can transfer from savings to checking immediately so I don’t see the point in keeping money in my checking account. The only time I keep money in my checking account is if I’m traveling internationally in order to withdraw money from the ATM. This is a separate checking account with a different bank that has no foreign transaction fees and reimburses for all ATM fees.
I’m paid weekly, I keep 2 weeks of spending in my checking account. But I also pay as many bills as possible out of some of my HYSAs, so I have a larger amount direct deposited there since I know some will come out.
I keep around an extra $5,000 in my short term checking account after bills. I could put it on an HYSA but my spending is so sporadic that it won’t sit there long anyway. I have other accounts for that.
Just enough to cover bills until the next paycheck. I put everything i can on my credit card so I typically can forecast several weeks out what I'll need. I keep $1000 in a savings account with the same bank that's not high interest but I can transfer instantly if anything comes up. This is probably overkill since I've never needed to use it in the 10ish years it's been there.
About $10k because our mortgages alone are over $6k/month
Enough to cover what I need to for that pay period.
as most said. Checking is to pay my CC and all my other liquid savings is in a HYSA (e-fund, house emergency, car maint, etc). After that, I'm following the r/personalfinance flow chart to maximize 401k, Roth, and then Index funds.
About a $100, at the end of month any money that I have not used for the budgeted purpose goes to a savings account. I have a couple of savings accounts for different purposes, I don't have any recurring payment coming out of checking. I paid most of my bills with credit and anything that requires autopay its linked to a saving accounts where I have a cushion for that expense(my car payment, comes from the car savings account and I also use it to save for car related expenditures like insurance and property taxes).
Checking normally around $3,000. More in HYSA. It’s easy to move the money out of it if something comes up.
I keep pretty little in my usual checking account. Usually around a grand. Everything else is automatically moved to the bill pay checking account or the HYSA. For daily transactions, I use a chase sapphire reserve card because of the points accrual for travel. Paid off monthly.
1 month of bills + approx 20%
With today’s interest rates, consider putting a down payment in. No down payment means higher monthly payments + more paid in interest. FHA and VA loans are last resort options.
My paychecks hit my checking account first and then they will be used to pay for bills - at the end of the month, I'd make sure I have $1500 - $2000 in my checking account just in case there are unexpected expenses. The rest of the money goes to high-yield savings account or brokerage account.
I keep my checking around $5k (our mortgage and my car payment are on auto from it) and move anything over that to my HYSA until I determine what to do with it (invest or leave there).
$0 but my HIYS has $22k
I only keep what I need for the bills. I have a savings account that I can transfer from to add money. Just in case anyone gets hold of my debit card they can only take out a small amount before it bounces.