Life use accounts are precisely that, accounts and/or assets used for daily living. Checking, savings, and money market accounts (and some CDs) are all life use accounts. One way to think about life use accounts is simply as containers that hold your money as it comes in and out and you use it to live life.
A checking account is simply a life-use account. An account that helps you live your daily life. One way to think about a checking account is simply as a container that holds your money as it moves in and out and you use it to live life. When life-use accounts aren’t used appropriately we can end up with small inefficiencies that can add up to big losses. Almost everyone has a checking account and most don’t put much thought into them, but efficient use of a checking account can be the beginning of wealth building.
Checking accounts help you do everything to live life and the overflow allows you to save for big purchases to grow your wealth over time (much like a waterfall). Whenever you have too much money sitting in your checking account, you are missing an opportunity to put it to work for you.
Knowing how much money you need available to pay bills and expenses each month will give you an idea of how much to keep in a checking account over time. Keeping too large a balance in your checking account prevents you from financial gains your money could earn if it was allocated somewhere else. While the idea of a financial cushion in a checking account can be appealing, it’s really the wrong place to set money aside.
If you determine there’s too much money in your checking account, it may be time to move it to another type of account where it can start earning for you but still be available quickly: savings and money market accounts are two examples. Once you've linked your checking account(s) to InvestorKeep, we will alert you to opportunities to earn more on your money by moving it into accounts that may be better suited to your goals.