The average American has a slew of bank accounts to keep track of: savings, checking, retirement, and more.
While the number of accounts can seem overwhelming, not all of these financial buckets deserve an equal amount of attention. Some accounts you can set and forget while others you should check on several times per week.
If you’re wondering how often you need to look in on each type of bank or investment account, we’ve come up with a suggested schedule for you. Your financial needs and goals may require you to check on your cash more or less often, but these are good rules of thumb for how often your accounts need your attention.
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For most people, their checking account is the hub of their financial activities. With paychecks going in and bills going out, it’s crucial to keep on top of your checking account more than your other accounts.
Accessing your checking account a few times per week will help you avoid overdrafts, ensure your bills are paid on time, and help you monitor your transactions for fraudulent activity.
The more you know about your money, the easier it is to eliminate financial stress.
Emergency fund savings account
Financially savvy individuals have a savings account for when life goes south.
Experts recommend keeping three to six months’ worth of expenses in this account in the event of a medical emergency, job loss, or other catastrophic event.
Once you’ve stockpiled enough emergency savings, you only need to check on it once a quarter or so to pat yourself on the back for amassing a savings cushion and make sure the interest rate you’re earning is competitive.
Designated savings account for a specific goal
If you’re planning a lavish vacation or saving for a new car, you likely have a separate savings account dedicated to this purpose (so it doesn’t get mixed up with your emergency savings).
Watching these funds grow as you add to them can be very motivating, so check on this savings account as often as you need to maintain your enthusiasm to reach your goal.
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Checking on your retirement accounts too frequently can be counterproductive. If you see the value of your portfolio go down too often, you may get nervous and consider pulling your dollars out of your investments.
To avoid this temptation, only check your 401(k) once a quarter. This is often enough to tip you off when you need to switch out of a losing investment, but not so often that you’ll want to jump ship on saving for retirement.
When you look at your 401(k) balance, make sure you’re receiving the accurate amount of matching dollars from your employer.
Like your 401(k), you can stand to keep IRA check-ins to once a quarter or so. Take this opportunity to rebalance your investments (if need be) and calculate whether you’re on track to meet your retirement goals and timeline.
Regular brokerage account
If you have investments outside of your retirement accounts, you likely hold them in a brokerage account. If you’re actively trading, you’ll likely be in this account every day.
If not, checking on the performance of your investments once a month or even once a quarter is enough to keep you on top of things.
College 529 plan
If you’re putting money away for your child’s education in a 529 savings plan, you can set up automatic contributions to investments so you don’t have to constantly monitor the account.
Checking up on the account’s performance once a year is usually enough. At your yearly check-in, you can move more of your funds to low-risk securities (like bonds) and away from higher-risk ones (like stocks) to ensure your child will have enough money when college approaches.
Joint checking account
Many married couples combine their finances via joint checking accounts. While research shows that this may be a good idea for your relationship, having two people dipping into the same pot of money can complicate things.
If you have a joint checking account with your spouse, check the transactions for the account as often as needed to ensure the bills are paid.
Maintain clear, open, and regular communication with your partner so that neither of you gets blindsided by an empty bank account because you didn’t account for the spending of the other.
Certificate of deposit (CD) accounts
If you have a certificate of deposit (CD), your money is locked in at a specific rate of return, so there’s no need to check on it while it’s maturing.
However, it’s a good idea to look at your account a few weeks before the maturation date so you can decide whether to roll it over into a new CD.
Be aware that your bank or credit union may do this automatically unless you advise it not to.
Money market account
If you want to earn a better interest rate than a savings account but you’re not ready to put your cash in cold storage via a CD, a money market account is a good alternative.
Interest rates on these accounts can fluctuate daily, so check your account somewhere between once a month and once a quarter to ensure you’re earning a competitive rate.
Money going into your accounts doesn’t need much monitoring, as in the case of retirement accounts. However, if you’re pulling money out frequently, it’s important to check regularly to ensure you don’t overdraft or that you maintain any required account minimum balance.
In the case of money markets and CDs, the terms of the account can change. The performance of your brokerage and retirement accounts can also change over time.
So while you don’t need to check up on these quite as often, put a reminder on your calendar when you need it to ensure these once-in-a-while tasks aren’t forgotten and that you are growing wealth over time.