Banks are the last thing I'd worry about (I wouldn't) - they're highly regulated, audited, and have been dealing with this forever, since before 'passwords'.
Additionally, if you don’t list a beneficiary on any of these accounts, they have to go through probate court to gain access. The fewer hurdles and headaches that your loved ones have to go through the better. Having dealt with this early this past year with a family member, having the list of “chores” to do upon passing helps and reduces the headaches. Especially if those funds are necessary to pay for the sudden bills that a funeral and so on can bring up.
My wife and I have four kids and for each of them is a personal savings account, a savings account we keep for them to accumulate over time to avoid a taxable lump sump “gift”, and a tax advantaged educational savings account. For ourselves we have brokerage, savings, checking, and each have pretax and post-tax advantaged retirement accounts and health savings accounts. Many tech employees would also have 401k and possibly equity compensation accounts. And then any credit or debt (mortgage) accounts on top of that.
Our family is big, and the number of accounts scales with the number of people, but that’s about 25 without getting into anything moderately interesting.
The US based financial industry is a make work project for bankers as far as I can tell. The US creates all sorts of classification of money causing the need for at least 3 retirement account types, a college savings account per Child per contributor.
I'm only scratching the surface of the number and types of accounts an American can have. It is also useful to have different banks for different services.
Pretty common in the US verses the EU/UK. The basic middle income set would be:
A checking account
A savings account (might be at the same institution as the checking, might not)
From your employment you may have.
- A 401k Account
- A Health Savings Account (HSA)
- A Health Flexible spending account
These will be at whatever institution your employer uses. As these change every time you change jobs you might have multiples of these in play unless you are diligent in rolling over and closing old accounts.
You also might have:
- Individual Retirement Account (possibly two, one Roth, non-Roth)
- College Savings Account (if you have kids and want save for collage in a tax friendly way)
- Money Market/Broker account for stocks etc.
If you live in a community property state then you probably have a second set of some these so you that you don't mix individual assets with community assets.
Market consolidation has made it easier to go with an single provider for a lot of the above, but it's still busy work keeping on top of everything.
The only reasons I can imagine are fund transfer times, and some isolation security for big amounts. As a fellow dutchie, I just use one bank for personal, and one for my business.
You sign up for them and never close them. I probably have nearly 50 credit card accounts alone and since they're free of monthly/yearly fees, I really don't have much motivation to close them.
On top of that I have two retirement accounts, four bank accounts (not counting various accounts AT those banks), and more. They collect if you don't weed them out.
Someone may have chequing+saving at one bank, a stock brokerage (or retirement savings) account at another institution, and a may have credit card(s) from completely different one(s).
So that could potentially be (at least) three different financially-related accounts.
Not so uncommon in NL. As a Dutchy you should have heard of Bunq which allows you to open unlimited accounts. The idea is to use each as savings pots for specific things such as a holiday, car, groceries, etc.
Other banks allow the same thing via virtual accounts.
Sign up bonuses. Some give an extra few percent on interest when you sign up, so you move all your money in, collect, then close the account out and go to another bank and repeat.
It’s not necessarily related to wealth (except that you need some savings), but when ING Direct was a thing my wife and I had an account for every savings goal and used it as our “envelope” system. There was no cost per account and you could open one in seconds, so we had a bunch of low value (dozens of dollars! Dozens!) accounts for saving for our next phone or vacation. That could have been done with a spreadsheet, but it was less work to just make separate accounts.
