WHY PEOPLE KEEP TOO MUCH MONEY IN THEIR CHECKING ACCOUNT

WHY PEOPLE KEEP TOO MUCH MONEY IN THEIR CHECKING ACCOUNT

People keep too much money in their checking accounts for different reasons. Many of them are kept for growing, saving, emergency, investing, and business purposes. But how much money they should keep in their checking account, I wrote a detailed article on this topic, but in this topic, I will tell you why people keep too much money in their checking accounts:

1. PEOPLE DON’T HAVE A PLAN FOR SAVINGS

If people don’t have a plan for saving or investing they leave their money in a checking account. Why people don’t have plans for saving or investing? The answer is due to a lack of financial knowledge. They think they will grow their money by leaving a particular amount every month in their checking account.

But they don’t know the importance of investing in any program. They can gain their money quickly by investing in a valuable program like the stock exchange and real estate. People also don’t know inflations and ROI.

Nowadays, learning is easy everywhere. If you want to grow your money, you have to learn personal finance, investing, saving, and accounting to grow money for your future.

People keep too much money in their checking accounts because they do not know what emergency fund, how much they should leave for emergencies, and where to save this emergency fund. 

2. YOUR EMERGENCY FUND IS ALREADY FULL

The second reason why people leave too much money in their checking account is they saved a lot of money for their emergency, but they do not know how to invest. According to their opinion, the purpose of their saving is only for emergencies after fulfilling all needs and desires.

But if they invest this spare money from the emergency fund, they will become rich, or their children will become rich.  Their invested money is also beneficial for their society and country in many different ways. 

3. YOU’VE BEEN NEGLECTING OTHER FINANCIAL GOALS, LIKE RETIREMENT

The third reason why people leave too much money in their checking accounts is neglecting many important goals. They don’t want to build homes, don’t want to save for retirement, don’t want insurance plans for their dependents, etc. for different causes.

They don’t know these financial goals, they never learned personal financing, or no one suggested these financial goals.

The second cause is they don’t like their life, family, and relatives. So, they don’t want to participate in any financial goals. They don’t want to save for retirement and don’t want to build a home for their family and also don’t want insurance policies for their dependents due to abhorrence. 

 Addicted people also don’t have any financial goals therefore they keep too much money in their checking account. These addicted people have drug addiction, gambling, sexual and pornography addiction, video game addiction, behavioral addiction, etc.

4. PEOPLE MISSING OUT ON OPPORTUNITIES

People missed opportunities like purchasing cheap properties and stocks in recessions, purchasing equipment and household when prices were low, starting or purchasing precious business, etc. If you have a suitable income or savings, keep yourself updated about markets to take more benefits from these opportunities.

They missed these opportunities due to lake of knowledge of finance and markets. Or they don’t want to grow their money for different reasons. They are busy with other tasks or addictions. 

5. PEOPLE WORRIED OF MISSING OUT ON MONEY

People also keep too much money in their checking accounts because they are worried about missing out on money. If they invest somewhere else they lose their money. According to these types of people, the Stock exchange is gambling; people lose their money in it.

They also think if they purchase any real estate property, some possession mafia or gangster would take over it. As a result, they will lose their whole saving. Therefore they keep all money in a checking account.

CONCLUSION

The main point of keeping too much money in a checking account is a lack of knowledge of finance and markets. Due to lake of knowledge, they don’t have any saving plans or financial goals. People don’t remain updated about markets and they miss a lot of opportunities. Due to lake of law and rule knowledge and not having trust in the government, people worried about missing out on money.