Why you need more than one bank account and how many bank accounts you can have

Having one bank account isn’t just risky, it could be costing you cash.

Lots of people only have one current account. And if they’ve not yet switched it for some free cash, they’ve probably had it for a long time.

But limiting yourself to a single bank account — whether it’s through loyalty, indifference or simply not knowing you can have multiple current accounts — is a bad idea.

And opening up new accounts can bring benefits when managing and accessing your money – and even making some extra cash.

Keep reading or watch this video to see why I think you should have more than one account. 

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Can you have more than one current account?

Let’s get this cleared up first. Yes, even though many think they can only have one, there’s actually no limit to how many current account you can open from different banks. You might even be able to have more than one from the same institution.

Due to my job, I’ve got a number of current accounts, but most of you won’t need anything near that many. In fact even just having two can be enough. 

And there’s very little risk in opening and running multiple accounts. I’ve shared a few things to consider further down the article.

10 reasons to have more than one current account

Here are the main reasons I think you should open up extra accounts.

If your bank has technical issues

We rely so much on online and app banking nowadays that not having access for even a few hours can be much more than an inconvenience.

This week Lloyds, Halifax and Bank of Scotland apps were all down thanks to the Amazon Web Services downtime, and that’s not the first time something like this has happened.

A debacle with TSB a few years ago, where systems were down for a couple of days saw people unable to access their wages or pay their rent. Though the length of time the TSB systems were down has been an isolated incident, occurrences of website crashes and app downtime for hours are increasingly frequent at a number of banks.

The risk of this happening to your bank is the number one reason why I think you should have at least two current accounts. In this second account, you should put enough money in that you can cover essentials for a few days. If you can put more, even better.

Make sure that this second account isn’t part of the same group as your other one, as these tend to share technical systems. So If you’ve got a Halifax account, make sure the second isn’t Lloyds, and vice versa. And the same goes for Natwest and RBS. First Direct and HSBC have different systems, but it can’t hurt to do the same.

To separate your savings

When I was younger ,I was guilty of just having all my money in one account — savings and spending. This meant that I didn’t ever really know how much I had in savings, and it was possible to “accidentally” dip into those funds with everyday spending.

The answer to avoid this is to open up a separate account and move all your savings over. Then set up a standing order to regularly move more money each month.

You could, of course, put this cash in a normal savings account, but the top rates right now are in a handful of current accounts.

The best savings accounts

Check out our list of the highest paying regular, easy-access, fixed and ethical savings accounts

To keep your overdraft debt separate

This trick also works if you have a huge overdraft. If you’re regularly in the red, it can be hard to track how much if you’re also spending out of the same account.

But if you open a separate account for your everyday spending, you can begin to treat and manage the overdraft debt as you would any other owed money, such as a loan or credit card. That’ll help you focus on clearing it (especially since you’re likely paying a huge 40% interest on that cash).

To protect your cash from scammers

Sadly, there are more and more scams aimed at your bank accounts. From fake phone calls through to phone thefts, you’re at risk if you have all your cash sitting on one place.

Of course, if a crook does get access to one account, they might also be able to access others at the same time, so make sure your accounts are protected in advance.

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To manage your money with someone else

Every couple manages their money differently. Some only have their own accounts and that can work fine, but joint accounts are particularly good for joint expenses.

You need to have a chat with your partner about what works best for you, and it could be a joint account is a bad idea — especially since it will link you on things like your credit report.

For help with budgeting

I think it’s worth having a separate account too for your everyday spending. You only move over the cash you want to part with, whether on a weekly or monthly basis. Ultimately this will stop you overspending and also help you keep track of where your cash is going.

There are certain accounts that make this a lot easier. Monzo, Chase, HyperJar and Starling are all really good accounts for this as they also have additional pots or spaces to further break down your spending.

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To make some money

If you only want a maximum of two bank accounts, a really good option is to make sure one of them is going to be making you money.

There are plenty of accounts offering freebies such as Disney+ and cinema tickets or even money each month. The more of these you have the more you’ll get.

The best is probably a cashback current account. One from Chase will pay you cashback on supermarket and transport spending via the debit card.

To keep switching

I’ve made a lot of cash by switching from bank to bank and nabbing incentive bonuses each time. Now some people struggle with the idea of switching once, let alone repeatedly, and in part that’s because they like the bank they are with.

Well you can get around this by having a separate account that you just use for switching. The offers come and go, but there’s no harm having an account ready for when offers appear.

The best bank rewards and switch bonuses

Check out my list of all the offers you can get when opening a new current account

If you need to go into a branch

I’d also try to ensure one of your accounts — and again this can work if you only have two accounts — has a branch that you can physically walk into if you need to. 

Though I rarely need to go into a branch these days, there are times I do. If you need to take out a large amount of cash, sign forms or pay in cheques, a branch might be necessary. However, some banks allow you scan cheques via the app.

Yes, you can cover a lot of this online or over the phone, but I like the option to go into a branch if I feel the need. And if you’ve multiple accounts, it’s easy enough to make sure one of those is local.

For fee-free overseas spending

A final one to add to your wallet is an account that offers fee-free spending abroad, such as Chase, Starling, HyperJar, First Direct or Monzo. We have a full guide to specialist travel cards to help choose one.

How many current accounts can you realistically have?

There’s no legal limit to how many current accounts you can have, but in practice a few things cap it:

• Most banks will only let you hold one personal current account with them at a time (sometimes plus a joint account)
• Each new application involves a credit check, and too many in a short space of time can affect your credit score
• Banks can decline an application if they think you’re opening accounts purely to game switching offers

In practice, most people get the bulk of the benefit from two to four current accounts. Going beyond that, it’s really only worthwhile if testing and reviewing accounts is part of your job.

Do multiple current accounts affect your credit score?

Before applying for a new account, make sure your credit report is up to date and there aren’t any obvious warning signs. This is because you will be credit checked each time you open an account (except with Monzo, Chase or Starling).

It’s worth spacing the applications out rather than doing them all at once. And if you’re thinking of applying for a mortgage in the next six months, it’s wise to just hold off until that has gone through. But the risk is minimal.

I’ve written more about how bank switching impacts credit scores here.

Opening up additional current accounts

It’s very easy. You simply pick which account you want to open and go through the application process. You’ll enter details about your address history and income, and share ID such as your passport or driving licence.

Some accounts will let you do this completely online, and will absolutely be the case for digital only banks such as Monzo, Starling and Virgin Money. You’ll probably need to upload photos of ID.

Others might require you to visit a branch with ID to complete the process. I can’t say which ones will and won’t ask for this, but this happened for my Natwest and Barclays applications.

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How to manage multiple current accounts

Some benefits that come with additional accounts require things like additional direct debits or minimum payments in every month. But there are tricks to manage this.

You might also struggle to keep tabs of your many accounts, but some banks let you add on accounts from other banks. Password managers such as Bitwarden allow you to safely store all those different passwords and usernames.

And those only really become issues if you are having lots of accounts. If we’re talking about opening just two, three or maybe four accounts you shouldn’t have any problems.

Frequently asked questions

Expert thoughts on having multiple bank accounts from Be Clever With Your Cash

Two accounts is a sensible starting point for most people — one for everyday spending and bills, and one that quietly earns something in the background, whether that’s interest, cashback or rewards. The biggest single benefit isn’t complexity for its own sake; it’s simply not having all of your money sitting with a single bank when its app or website goes down.

Technical failure risk is the one most commonly underestimated. There have been serious outages at major banks in recent years, some lasting days rather than hours, leaving customers unable to access wages or pay rent. Splitting money across two providers — ideally ones that don’t share the same underlying banking infrastructure, as is the case with Halifax and Lloyds — turns a single outage into an inconvenience rather than a crisis.

The other underrated benefit is psychological rather than practical. Separating spending money from savings, or an everyday balance from an overdraft being cleared, makes it much harder to accidentally dip into money earmarked for something else. It’s a simple structural trick, but remains one of the most effective ways to actually stick to a budget.

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