“How much money should I keep in my checking account?” is one of those simple questions that really deserves a simple answer. Fortunately, we’ve got one. By following a few simple rules you can strike the perfect balance of saving and fun so you can live your best life.

How Much Money Should You Keep In Your Checking Account?

Having enough money in your checking account to handle things like unexpected expenses helps reduce stress and keep you on top of your expenses. But keeping too much there can mean missing out on opportunities to invest and save for the future. So let’s break down the things you should consider to make the right choice based on your wild dreams.

What’s the average checking account balance?

The most recent data available from 2023 puts the average amount in Americans’ checking accounts at $62,410. However, that doesn’t tell the full story, as the median is just $8,000. That number is far closer to the true average for most everyday folks.

That said, while the national median can give you some idea of what to aim for, there’s no one-size-fits-all answer. Personal factors like your m

How much money should I keep in my checking account?

Most financial experts recommend using a simple formula to determine how much money you should keep in your checking account: two months worth of living expenses in addition to a 30% buffer for safety.

Calculate your monthly expenses

Start by gathering bank and credit card statements along with bills for the past several months. Then, take the expenses within those documents and break them down into fixed expenses (those that don’t change each month like a mortgage payment), variable expenses (those that change every month like water bills or groceries), and discretionary expenses (things like buying a new computer that don’t occur often), alongside money that goes into things like savings.

Adding your fixed expenses to an average of your variable and discretionary expenses should give you a good idea of your total monthly expenses. Remember, this doesn’t have to be perfect, the goal is just to get a rough idea of what you typically spend in a month.

Add a buffer for unexpected costs

Adding that 30% buffer mentioned above is important to be prepared for emergencies. It also helps avoid overdraft fees and ensure you maintain a minimum balance if your account requires one.

The right account can also help a lot here. CFCU’s CloseEnuffTM checking account has features like a $50 overdraft buffer to help out when you need it. But beyond just having a buffer, this account has no monthly fees and no minimum balance, so you can spend more on the things you want.

Consider income frequency and stability

Figuring out how much you should keep in your checking account is about more than just expenses, you also need to think about your income. How often do you get paid and how predictable are those payments? The less predictable your income the more money you should keep on hand just in case.

Of course, it can be tough to understand your income and expenses when they change from month to month. The CFCU mobile app can help. With tools to track expenses and cash flow, it makes it easy to stay on top of your finances and create some predictability.

Best places to keep your additional cash

If keeping two months expenses plus 30% in your checking account is good, keeping even more in there is better right? Not exactly. Money in your checking account isn’t taking advantage of higher interest rates you can get in places like savings accounts, CDs, or other investments. Anything above that minimum should really go into long-term savings.

What are High-yield savings accounts?

High-yield savings accounts represent a middle ground between checking accounts and things like CDs. This money can be accessed in an emergency but is still kept in a place where it can earn interest and grow far faster than if it stayed in your checking account. That’s why you should keep 3-6 months worth of expenses in an account like this.

CFCU’s high-yield savings account offers 10% APY on your first $1,000. That means $100 a year that compounds with time to help give you financial security. Plus, it’s just $5 to open, comes with no fees or no minimum balance, and earns credit union dividends. Keeping money there means being ready for an emergency while ensuring your money grows for the future.

CDs and Money Markets for longer-term savings

For money you know you won’t need to access even in an emergency, CDs and Money Markets offer a great way to let it grow faster. Unlike investments in stocks, you’re guaranteed a set rate of return in exchange for keeping the money there for a specific period of time. The longer you keep your money there, the more it earns.

At CFCU, we have flexible CD and Money Market options that make it easy to maximize your returns while minimizing hassle. Plus, CDs and Money Markets are not based on what’s happening in the stock market or economy, so they’re a good way to protect against volatility.

Figuring out how much money belongs in checking, savings, and tools like CDs is simple once you know the basics. But even if you’re just getting started with figuring out your personal finances, CFCU can work with you to figure it all out!

Our members always enjoy personalized services alongside all kinds of tools to help you learn how to build personal wealth and enjoy financial freedom. Join over the phone or in person to enjoy everything we offer plus free financial counseling.

*Accounts must be opened by November 30, 2025. Direct deposits must be active within 6 weeks of account opening. Direct deposit must continue for 90 days. Monthly direct deposit amounts must meet a tier’s minimum amount each month to qualify for the bonus. One bonus per member. Promotion based on SSN number. Members who also qualify for referral bonus will receive both promotional bonuses. An account is considered new if another was not opened within 6 months. Federally insured by NCUA. Member eligibility required. Payout will be mid-April 2026.