It’s sometimes hard to know where to keep your money. Our world is full of advertisements for banks, investment brokerages and other quasi-financial institutions that are encouraging you to keep your money with them. With money flowing in from our paychecks and money flowing out for; bills, credit cards and loan repayments, it can be tricky staying on top of everything and knowing that all your money is in the right spot. I thought I’d share a little of where I keep my money and share some recommendations that I have.

Checking account

I have a checking account through a large, national bank. This bank has ATMs and branches all over the country, which I find helpful knowing that if I needed money or assistance that it’s likely there’s a branch of ATM nearby, whether at home or while travelling. This checking account is where I put my paychecks, via direct deposit. It’s sort of the first stop from all my money. I know how much I make each month and track my spending against it. I move money out based on my amount of savings that month, and then keep the rest in there to pay my credit card off and mortgage. I keep enough in there to meet my monthly requirements.

Savings account

Each month I like to move money into savings. I have a few savings accounts, some for general savings and some for specific purposes, like saving up for grad school or buying a car. I keep a small savings account with my main bank. Although it doesn’t pay a ton of interest, I keep money here in case of emergencies, so I can quickly move money into my checking if needed. The rest of my savings are in an online bank, like American Express or Ally Bank. These banks pay around 0.5% interest, which is like 10x when I get from my national bank. If my money is just going to sit there for a while, I’d prefer it earning as much interest as it can.

Brokerage account

A portion of my budget each month is also set aside for investing. This is money I don’t need right now, but would like it to grow. I’ve got a cushion in my savings account so I take more risk with this set of money and put it in the stock market. I have a brokerage account through TD Ameritrade. From this account, I typically invest in index funds, as they are typically lower risk than other mutual funds or stocks, with less fees.

Retirement account

I have 2 retirement accounts; 1 is my 401(k) through work, which is hosted through Fidelity. I contribute 9% and get a 6% match (for the total recommended amount of 15%) from my paycheck, so it’s money I don’t even see. I also have a separate IRA (individual retirement account) through a brokerage account connected to the major bank that I bank with. I’ve rolled over previous 401(k)s from employers I’ve left. I do this because I like have my money in fewer places instead of all over the place, and an IRA typically has less fees and more options compared to a 401(k).

Credit Cards

I love rewards credit cards and have several of them. I put probably 95% of my monthly spending on them, and then at the end of the month when the bill is due, I pay them off, in full to avoid any interest charges. I pay them off from money I’ve kept in my checking account. Things have gotten a little out of hand and a year or two ago I found myself paying nearly $1,000 in annual fees and here’s how I rationalized it and what changes I made.

Summary

There you have it, where and how I keep my money. Getting setup can be a little tricky but doing so in a thoughtful manner can make your life easier and help earn you more money! I always say, you work hard for your money and it should work hard for you!