How much money should I keep on hand?

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  • An ATM installation in Art Basel Miami Beach displays bank balances and ranks people.
  • Experts recommend keeping a small amount of your money in the checking account.
  • The rest should be saved or invested depending on your risk tolerance, timeframe, and goals.

Art Basel Miami Beach installed an ATM displaying attendees’ bank account balancesFor everyone to see.

This viral video was posted on Twitter by Joel FrancoThe ATM is an art installation created by a Brooklyn-based group. MSCHFThe leaderboard displays the balance and picture of each spectator, as well as their balance. Insider’s Pete Syme reports that the leaderboard has so far been dominated by a man worth $2.9 million, while a person with $48,000 could not make it to the top 20. 

An ATM is typically used in conjunction with a checking account, which would mean people have tens of thousands — even millions — readily accessible. But what about the rest? What amount are we allowed to keep in our checking accounts?

A checking account should not hold all of your money

A smart banking setup includes more than just a checking account. It is a place where you can withdraw cash and your paychecks might be deposited. While it’s better than keeping your cash under your mattress, experts typically don’t recommend keeping all — or even close to all — of your money in checking.

Financial planner Marci Bair of Bair Financial Planning in San Diego, California, previously told InsiderA person with a steady income should only keep “no more that about two months’ worth of expenses” in their checking account at any given moment. This is because, while you want to have enough money in your account for your monthly bills, there are greater opportunities for your money to grow in other places, such as retirement accounts. brokerage accountsCDs, or high-yield savings accounts.

See Insider’s picks for the best checking accounts »

Your goals, your time frame, and your tolerance for risk will all play a role in how you decide where your money goes. Retirement savings would be a good investment because you have decades to weather market fluctuations. High-yield savings might be a better option if you are going to need the money within the next five years. High-yield savings is an option. However, CDs and savings don’t pay the same interest as savings (currently about 3%), but high-yield checks are an option.currently around 4%), or the stock market (which has returned about 14% over the past 10 years).

Keep in mind that you can have multiple accounts. Tiffany Aliche, author and expert in personal finance, told Insider previously that she recommends everyone have four bank accountsTwo checking accounts and two savings accounts are required for a low-effort but high-reward budgeting plan. One checking account is used for bills and the other for spending via debit cards. One savings account can be used for your expenses. emergency fundThe first is for other purposes. This does not include investments.

So, let’s get back to Art Basel. Should $2.9 million be kept in check? 

It all depends on how much money you spend each month.

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