Have you ever wondered how much money you should have in your checking account?
You’re not alone. Your checking account balance is constantly fluctuating based on bills, payments, withdrawals, etc. It can be a juggling act to make sure you have enough cash to avoid overdrafting (psst: Chime has no overdraft fees!)
To get to the bottom of this and help you figure out how much money you should have in your checking account, we spoke with 10 personal finance bloggers. They gave us the low-down on what they think is the average checking account balance. Read on to learn more.
1. Personal finance expert Dr. Cozette M. White
“For beginners, I would recommend a minimum of $500 in your checking account at all times,” she explains.
If you’re already managing your finances pretty well, she recommends boosting that amount.
“For our more seasoned or advance person, I’d recommend maintaining at a minimum $2,000 – $3,500 or in your account at all times.”
2. Jaymee Sison from Smart Woman Blog
While it’s important to have enough money in your checking account to cover your bills, too much money can be a lost opportunity. Why? Because a savings or investment account can earn you greater returns.
That’s why Jaymee Sison from Smart Woman Blog also recommends having $500 in a checking account.
“I generally like to keep no more than $500 in my account. I feel any balance over $500 sitting in a checking account that’s not growing for me is a lost opportunity; it’s better invested or put towards other financial goals (e.g. debt repayment) instead.”
How much does she have in her account now? $125.
3. Debbi King, author of The ABC’s of Personal Finance
Debbi King, an author and motivational speaker, recommends having at least one month of expenses in a checking account.
“If money is not an issue, ideally I would keep one month of expenses in my checking. That is what I have right now,” she says.
But for people just starting out on their journey, this can be a lot. She recommends saving at least enough to save you from paying bank fees (hint: Chime never charges fees!)
“Having $100 or more can save you fees at most banks. However, you don’t want too much either for several reasons: Identity theft (you don’t thieves to clean you out), and you don’t want to overspend.”
4. J. Money from Budgets Are Sexy
Money from Budgets Are Sexy thinks having a solid grand in your checking account is a good move.
“Having a $1,000 buffer in checking has done wonders for me over the years… not too much where it’s hard to keep it there, but enough to cover stupid mistakes or anything else that comes up that would normally put you in the negatives. Also makes for a great mini-emergency fund too! And who doesn’t like the safety of that?” says the popular financial blogger.
5. Kevin Panitch from Just Start Investing
Kevin Panitch from Just Start Investing agrees that having enough to cover a month’s expenses is a good amount for your checking account.
“I think that someone should keep enough in a checking account to cover monthly expenses, and no more. A checking account should be the central hub of your finances, with money flowing through it but never staying there for too long,” he says.
“This is because checking accounts pay next to no interest, so by keeping more than the bare minimum in a checking account, you’re actually losing money due to inflation.”
6. Nathan Clarke from Millionaire Dojo
Nathan Clarke from Millionaire Dojo suggests having a small amount in your checking account while having a strategy to make the most out of it.
“I suggest people have the minimum amount to cover their spending and maybe $500 additional in case something unexpected comes up,” he says.
“I pay for everything with credit cards to earn travel points and pay them off each month with my debit card. I have my retirement contributions pulled from my paycheck, so all the money from my biweekly paychecks goes into my checking account to pay off my credit card. If I have more than $500 in checking after paying off the credit cards, I’ll move the excess cash to savings or my Roth IRA.”
7. Tawnya Redding from Money Saved is Money Earned
Tawnya Redding from Money Saved is Money Earned also recommends having one month’s of expenses in your checking account balance.
“I’d recommend having at least a month’s worth of expenses in a checking account. Most people pay bills and other loans directly out of their checking account so you want to make sure you have enough that you won’t overdraft (you don’t want to be having to constantly check and switch money around),” she explains.
And, watch out for having an excess of cash in your checking account.
“You don’t want much more than that (a month’s worth of expenses) because checking accounts give you so little in interest. For most of your cash and emergency fund I’d recommend a high-yield savings account,” she says.
Redding says she has about $3,000-$4,000 for her checking account balance and that covers her monthly expenses and gives her a bit of a cash cushion.
8. Lance Cothern, founder of Money Manifesto
Lance Cothern, the blogger behind Money Manifesto also recommends having one month of expenses in your checking account (growing consensus, right?)
“I recommend people keep one month of expenses in their checking account. This way, they’re always a month ahead with their finances and can make adjustments if something unexpected pops up. I top off my checking account to at least one month of our usual expenses ($4,500) at the beginning of every month,” he explains.
9. Keith Schroeder from The Wealthy Accountant
Keith Schroeder from The Wealthy Accountant recommends having $1,000 in your checking account.
“I only keep around $1,000 in my personal checking account because I have no debt and bills don’t add to that much.” he says.
But he brings up an interesting point about having much more in a business checking account. “My business account is a different story. My business is cyclical so it is common for my checking to be $50,000 in the first half of the year and $5,000 outside tax season. The remainder resides in money market accounts as working capital. Excess cash is invested,” he says.
10. Stephanie Kibler from Poorer Than You
Stephanie Kibler from the blog Poorer Than You has dealt with fluctuating income over the years, making it tough to manage income and expenses.
“For much of my adult life, I’ve had a variable income. Even when I had a salaried job, I had side hustles going and could never be 100% certain what my income would look like month to month. This made things a little rough, and during lean months I would always find myself dipping into my emergency fund for things that were not actually emergencies, just normal spending that I couldn’t quite cover because income was lower than average,” she says.
After getting sick of dipping into savings, she built up a one month buffer in her checking account and has kept up with it for six years now.
What should your checking account balance be?
As you can see, personal finance experts and bloggers have different views. It seems most agree to have between $500 to one month of expenses to ensure you can cover your bills and expenses. This also allows you to build a small cushion for unexpected expenses.
Here’s a final tip: A fee-free checking account like Chime can help you manage your money without getting hit with pesky fees. Plus, you can automate your savings and get ahead financially.