Your checking account is sufficient to hold all of your funds, correct? Yes, technically. However, it may not be the greatest option for holding big sums of cash.
Your goals and situation determine the ideal checking account balance. You should have enough money for the next month or two.
If you can meet your essential expenses for the next month or two with the monies in your checking account, you at least have sufficient funds.
Say your monthly expenses are $2,500. Add $500 (20% of $2,500) as a cushion, bringing your total to $3,000. $6000 will cover two months of costs.
If the quantity of money in your checking account can cover the costs of essentials for at least five months, you almost certainly have an excessive amount of cash.
Too little money in your account can result in bank fees. If your balance is low and you overdraw, you may be charged an overdraft fee.
It's also a bad idea to retain a lot of cash in your checking account because most of them don't pay interest on the money you keep there.
Everyday checking accounts are convenient. They're great for deposits and withdrawals. But, savings accounts are superior for storing money.