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  • Michael DiBartolomeo

How Much Money Should a Person Keep in Their Checking Account?

Updated: Feb 24, 2022

Having different kinds of accounts sounds like a fantastic idea for many people, but they often don't know how much they should have, which is why they ask, ‘how much money should a person keep in their checking account?’ – this article explains the basics all clients must know.

How much money to keep in a checking account

How much money to keep in a checking account

Minimum Balance

If the person opens a checking account, they might already know they need a minimum daily balance. Otherwise, they might have to pay fees or risk getting the account closed.

The exact amount of money depends on the person, so there is no specific sum someone must have on a daily basis. In some cases, it can be as low as five dollars, whereas other people need to have at least $500.

Avoiding Overdrafts

When it comes to keeping money in checking accounts, having a cushion to avoid overdrafts is always a good idea besides the daily balance.

Many clients don't know what an overdraft is, which is why they often buy things or pay for services without realizing they're making the wrong choice. A skilled financial consultant like the experts at Kelley Financial Group, for example, could explain everything to the person, so they understand what they must do to improve their situation and get a better rate of return.

Purchases that are greater than what people have in their accounts cause overdrafts, so clients must be careful since banks charge fees when that occurs.

To avoid overdrafts, all people need to do is ensure they have more money in their checking accounts. Thus, the cushion can help in case they have to pay something.

Covering Utilities

In some cases, people set their checking accounts to automatically pay utility bills each month. That's a fantastic idea, but they must ensure they have enough to cover it without harming their financial situation.

Seasons are another factor to keep in mind, especially if they affect utility bills. The winter, for example, is often the cause of higher gas or electricity usage.

Clients that pay utility bills with their checking accounts should have a buffer, which ensures they can always pay for everything even if the bills vary.

Considering Everyday Expenses

Financial advisors often suggest people keep one to two months’ worth of money in their checking account.

Some clients might not understand why they should only keep so little money in their checking account, and they may make the mistake of having more in there. However, if they hire a financial advisor, the expert could explain everything.

Professionals at Kelley Financial Group have a lot of experience helping clients through different situations, and they can identify the best options and recommend them to people. They might, for example, suggest the client only has one to two months’ worth of savings to keep the rest of their money in another type of account, which could earn higher interest.

Never Have All Savings in the Account

Keeping the right amount of money in the checking account is vital if the person wants to manage their finances properly. Thus, as it was mentioned above, they must have enough savings but never keep all of them in there.

Instead of having all their savings in the checking account, people can divide them into different accounts, for example, a retirement fund, a savings account, etc. Consequently, they can earn higher interest and be more protected since they're less prone to spending by accident.

Protecting the Account

Having a checking account is a fantastic idea, but the owner needs to keep both their money and their identity safe. To achieve that, financial advisors such as the ones at Kelley Financial Group might recommend different things.

Clients must log in to their accounts from time to time (at least once a month), even if they've set up security measures such as alerts when transactions occur. At the same time, they should prioritize using secure connections each time they're logging in.

There are other strategies they could use to ensure their accounts are safe, but financial advisors are the right professionals to explain everything to each client, which is why hiring them is essential.


Checking accounts are highly beneficial for many clients, and each person could have a specific amount of money in there depending on different factors, so asking ‘how much money should a person keep in a checking account?’ means the answer changes for each case. Financial advisors can suggest various actions to ensure the client is making the best choices and keeping their money safe.

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