Am I putting myself at any security risks by putting all my money in one bank institution?
For small amounts I wouldn't be too concerned.   There are two factors I can think of: For relatively small amounts and when dealing with reputable banking institutions there should be little concern of banking with a single bank.  It's what most people do.
There are two parts to this. Firstly, if you are also living in the property you have bought, then you should not consider it to be an investment. You need it to provide shelter, and the market value is irrelevant unless/until you decide to move. Of course, if your move is forced at a time not of your choosing then if the market value has dropped, you might lose out. No-one can accurately predict the housing market any more than they can predict interest rates on normal savings accounts, the movement of the stock market, etc.  Secondly, if you just have a lump sum and you want to invest it safely, the bank is one of the safest places to keep it. It is protected / underwritten by EU law (assuming you are in the EU) up to €100,000. See for example here which is about the UK and Brexit in particular but mentions the EU blanket protection. The other things you could do with it - buy property, gold, art works, stocks and shares, whatever thing you think will be least likely to lose value over time - would not be protected in the same way. http://www.fdic.gov/deposit/deposits/index.html  FDIC currently insures up to $250,000.  (I would have put that as a comment to Jeffery but it says it was locked.) You don't want to put all your eggs in one basket.  If you shop around, and keep shopping all the time you can keep your accounts in a single place so long as that single place provides the best deal.  Don't have any loyalty to your banking institutions because they don't have any loyalty to you. Also, having lots of accounts means you are familiar with lots of institutions, so you are likely better at shopping around. Things I consider. For fewer institutions: For more institutions: A CDIC-insured high-interest savings bank account is both safe and liquid (i.e. you can withdraw your money at any time.)  At present time, you could earn interest of ~1.35% per year, if you shop around. If you are willing to truly lock in for 2 years minimum, rates go up slightly, but perhaps not enough to warrant loss of liquidity. Look at GIC rates to get an idea. Any other investments – such as mutual funds, stocks, index funds, ETFs, etc. – are generally not consistent with your stated risk objective and time frame. Better returns are generally only possible if you accept the risk of loss of capital, or lock in for longer time periods. "With regard to your edit (although I didn't downvote): one way to reduce the security risk is to separate the payment from the ability to drain your account.  A considerable part of the security risk is inherent in giving people a number which is directly linked to a bank account where you keep all your money.  If you don't want that risk, don't do that.  Instead of (or in addition to) trying to reduce the chance of fraud, you can reduce the impact of fraud, even if it occurs, by not paying for things using the details of an account where you have all your money.  Trying to protect against fraud while keeping all your money in the account is sort of like carrying around thousands of dollars in cash in your wallet and then worrying about how to defend against robbery.  Yes, you can carry a weapon or hire a bodyguard, but it's probably simpler to just not carry that much money in the first place. You already mentioned one solution with your option #1, which is to just keep a small amount of money in a separate account and use that for online payments.  Assuming you can easily transfer money in and out of this account via online banking, this effectively is what you say you want in your edit: you log in to your bank online, but rather than ""informing it"" you're about to make a payment, you just transfer money in.  You'll probably have to keep a small amount of money in the account to keep it open, but if this is an important issue for you, that shouldn't be that big a deal. Another solution is a credit card.  With a credit card, you simply make the payment online.  In the US, if the merchant (or someone else stealing the info) makes fraudulent charges, the credit card company assumes the liability and the consumer suffers only the inconvenience of having to get a new card issued.  I don't know what the UK laws are regarding credit vs. debit fraud, but some sites I found seem to suggest that credit cards have fraud protection in the UK as well.  This is probably worth looking into if you are concerned about fraud." The mode of payment mentioned by your bank is called the ACH(Automatic Clearing House) which means that anyone(Trusted payment gateway owners like banks themselves) can process payments. There can be a fraud declared against any payment that you have made and you can get every single penny back. This amount can not be withdrawn in cash at all. However for your situation I would suggest that you ask your bank to block any transactions above the amount of a specific sum, this way they will require your authorization to finalize the payment. You should feel safe after this. Also no one can access any other account apart from the one whose details you are giving out so do not worry about this guy(or anyone else for that matter) to be able to access your other accounts.  Hope this helps. (I have experience in payment gateways so I do understand these procedures.) Cheers!! There is nothing to worry about. There is absolutely nothing unusual about moving money between your own accounts, even if they are in separate financial institutions. I moved $200,000 when I was getting ready to by my house; I have moved similar sized chunks for other purposes. A large transfer may get some attention to make sure you aren't doing anything illegal with the money and aren't being scammed... but if the transaction is legitimate, that attention is harmless. "Depends on your definition of ""secure"". The most ""secure"" investment from a preservation of principal point of view is a non-tradable, general obligation government bond. (Like a US or Canadian savings bond.) Why? There is no interest rate risk -- you can't lose money. The downside is that the rate is not so good. If you want returns and a reasonably high level of security, you need a diversified portfolio." "The danger to your savings depends on how much sovereign debt your bank is holding.  If the government defaults then the bank - if it is holding a lot of sovereign debt - could be short funds and not able to meet its obligations. I believe default is the best option for the Euro long term but it will be painful in the short term.  Yes, historically governments have shut down banks to prevent people from withdrawing their money in times of crisis.  See Argentina circa 2001 or US during Great Depression.  The government prevented people from withdrawing their money and people could do nothing while their money rapidly lost value. (See the emergency banking act where Title I, Section 4 authorizes the US president:""To make it illegal for a bank to do business during a national emergency (per section 2) without the approval of the President.""  FDR declared a banking holiday four days before the act was approved by Congress.  This documentary on the crisis in Argentina follows a woman as she tries to withdraw her savings from her bank but the government has prevented her from withdrawing her money.) If the printing press is chosen to avoid default then this will allow banks and governments to meet their obligations.  This, however, comes at the cost of a seriously debased euro (i.e. higher prices).  The euro could then soon become a hot potato as everyone tries to get rid of them before the ECB prints more.  The US dollar could meet the same fate. What can you do to avert these risks?  Yes, you could exchange into another currency.  Unfortunately the printing presses of most of the major central banks today are in overdrive.  This may preserve your savings temporarily. I would purchase some gold or silver coins and keep them in your possession.  This isolates you from the banking system and gold and silver have value anywhere you go.  The coins are also portable in case things really start to get interesting.  Attempt to purchase the coins with cash so there is no record of the purchase.  This may not be possible." Firstly, sorry about the accident. I am afraid you will need to do your own legwork, because you cannot trust other people with your money.  It's a good thing you do not need to rush.  Take your time to learn things. One thing is certain, you cannot let your money sit in a bank - inflation will digest them. You need to learn about investing yourself, or you run a risk of someone taking advantage of you.  And there are people who specialise in exploiting people who have money and no idea what to do with them.  There is no other way, if you have money, you need to know how to deal with it, or you are likely to lose it all.  Since you need to have monthly income and also income that makes more money to make further investments, you need to look at two most common investments that are safe enough and also give good returns on investment: Property and index funds. You might also have a look at National bonds as this is considered safest investment possible (country has to go bust for you to lose money), but you are too young for that.  Young = you can take more risk so Property and shares (indexes). You want to have your property investments in a country that is stable and has a good ROI (like Netherlands or Lithuania). Listen to some audio lectures: https://www.audible.co.uk/pd/Health-Personal-Development/Investing-in-Real-Estate-6th-Edition-Audiobook/B008SEH1R0 https://www.audible.co.uk/pd/Business/The-Secrets-of-Buy-to-Let-Success-Audiobook/B00UVVM222 https://www.audible.co.uk/pd/Non-fiction/Economics-3rd-Edition-Audiobook/B00D8J7VUC https://www.audible.co.uk/pd/Advanced-Investments-Part-1-Audiobook/B00HU81B80 After you sorted your investment strategy, you might want to move to a country that is Expat friendly and has lower living costs than US and you should be able to live like a king... best of luck. Usually the most significant risk scenarios here are: Third parties can abuse your routing/account numbers to initiate debits, but this is a type of fraud that is easily traced. It can happen, but it is more likely that it would be a scenario where you were specifically targeted vs. the victim of some random fraud. Defending against someone who is specifically going after you is very difficult, especially if you don't know about it. Your SSN isnt used for the bank transfer, you are providing it so that the entity making the payments can report on payments to you for tax purposes. If you are truly worried about this type of scenario, I suggest setting up a dedicated savings account for the purpose of receiving these payments and then sweeping (either manually or automatically) the funds into another account. Most stock brokers will allow you to automate this, and most banks will let you do this manually. "I'd suggest you start by looking at the mutual fund and/or ETF options available via your bank, and see if they have any low-cost funds that invest in high-risk sectors.  You can increase your risk (and potential returns) by allocating your assets to riskier sectors rather than by picking individual stocks, and you'll be less likely to make an avoidable mistake. It is possible to do as you suggest and pick individual stocks, but by doing so you may be taking on more risk than you suspect, even unnecessary risk.  For instance, if you decide to buy stock in Company A, you know you're taking a risk by investing in just one company.  However, without a lot of work and financial expertise, you may not be able to assess how much risk you're taking by investing in Company A specifically, as opposed to Company B.  Even if you know that investing in individual stocks is risky, it can be very hard to know how risky those particular individual stocks are, compared to other alternatives. This is doubly true if the investment involves actions more exotic than simply buying and holding an asset like a stock.  For instance, you could definitely get plenty of risk by investing in commercial real estate development or complicated options contracts; but a certain amount of work and expertise is required to even understand how to do that, and there is a greater likelihood that you will slip up and make a costly mistake that negates any extra gain, even if the investment itself might have been sound for someone with experience in that area.  In other words, you want your risk to really be the risk of the investment, not the ""personal"" risk that you'll make a mistake in a complicated scheme and lose money because you didn't know what you were doing.  (If you do have some expertise in more exotic investments, then maybe you could go this route, but I think most people -- including me -- don't.) On the other hand, you can find mutual funds or ETFs that invest in large economic sectors that are high-risk, but because the investment is diversified within that sector, you need only compare the risk of the sectors.  For instance, emerging markets are usually considered one of the highest-risk sectors.  But if you restrict your choice to low-cost emerging-market index funds, they are unlikely to differ drastically in risk (at any rate, far less than individual companies).  This eliminates the problem mentioned above: when you choose to invest in Emerging Markets Index Fund A, you don't need to worry as much about whether Emerging Markets Index Fund B might have been less risky; most of the risk is in the choice to invest in the emerging markets sector in the first place, and differences between comparable funds in that sector are small by comparison.  You could do the same with other targeted sectors that can produce high returns; for instance, there are mutual funds and ETFs that invest specifically in technology stocks. So you could begin by exploring the mutual funds and ETFs available via your existing investment bank, or poke around on Morningstar.  Fees will still matter no matter what sector you're in, so pay attention to those.  But you can probably find a way to take an aggressive risk position without getting bogged down in the details of individual companies.  Also, this will be less work than trying something more exotic, so you're less likely to make a costly mistake due to not understanding the complexities of what you're investing in." In the US, I would say the risk is exactly the same.  If your accounts are withing the FDIC amount (currently $250,000) your balance is 100% covered in case of a failure. You are giving up a larger network of ATMs in some cases.  You are also perhaps giving up the number of branches you can visit, the hours the bank is open and maybe how well the website works.  The features might be less, but the protection for your deposits is the same. As mentioned in the other answer, you can't invest all of your money in one slightly risky place, and to receive a significant return on your investment, you must take on a reasonable amount of risk, and must manage that risk by diversifying your portfolio of investments. Unfortunately, answers to this question will be somewhat opinion and experience-based. I have two suggestions, however both involve risk, which you will likely experience in any situation. Peer to Peer Lending In my own situation, I've placed a large sum of money into peer-to-peer lending sites, such as LendingClub. LendingClub specifically advertises that 98% of its user base that invests in 100 notes or more of relatively equal size receive positive returns, and I'm sure you'll see similar statements in other similarly established vendors in this area. Historical averages in this industry can be between 5-7%, you may be able to perform above or below this average.  The returns on peer to peer lending investments are paid out fairly frequently, as each loan you invest in on the site pays back into your account every time the recipient of the loan makes a payment.  If you invest in small amounts / fractions of several hundred loans, you're receiving several small payments throughout the month on various dates. You can withdraw any money you have received back that hasn't been invested, or money you have in the account that hasn't been invested, at any time for personal spending. However, this involves various risks, which have to be considered (Such as someone you've loaned money to on the site defaulting). Rental Property / Property itself I'm also considering purchasing a very cheap home, and renting it out to tenants for passive income. This is something I would consider a possibility for you. On this front, you have the savings to do the same. It would be possible for you to afford the 20% downpayment on a very low cost home (Say, $100,000 or less up to $200,000 depending on your area), but you'd need to be able to pay for the monthly mortgage payment until you had a tenant, and would need to be able to afford any on-going maintenance, however ideally you'd factor that into the amount you charged tenants. You could very likely get a mortgage for a place, and have a tenant that pays you rent that exceeds the amount you pay for the mortgage and any maintenance costs, earning you a profit and therefore passive income. However, rental properties involve risks in that you might have trouble finding tenants or keeping tenants or keeping the property in good shape, and it's possible the property value could decrease.  One could also generalize that property is a somewhat 'safe' investment, in that property values tend to increase over time, and while you may not significantly over-run inflation's increase, you may be able to get more value out of the property by renting it out in the mean time. Additional Note on Credit You mention you have a credit card payment that you're making, to build credit. I'd like to place here, for your reference, that you do not need to carry a balance to build credit. Having active accounts and ensuring you don't miss payments builds your history. To be more specific, your history is based off of many different aspects, such as:  I'm sure I missed a couple of things on this front, you should be able to find this information with some research. Wanted to make sure you weren't carrying a balance simply due to the common myth that you must do so to build credit. Summary The items mentioned above are suggestions, but whatever you choose to invest in, you should carefully spread out / diversify your portfolio across a variety of different areas.  It would not be advisable to stick to just one investment method (Say, either of the two above) and not also invest in stocks / bonds or other types of investments as well.  You can certainly decide what percentage of your portfolio you want to invest in different areas (for instance X% of assets in Stocks/bonds, Y% in real-estate, etc), but it does make the most sense to not have all of your eggs in one basket. "Yes you should worry and take care not to violate the law or provide any appearance of impropriety.   Every bank in the USA is required under the Bank Secrecy Act to report cash transactions over $10,000 the same day to the IRS -- and here's the fun secret part -- without notification to the depositor.   But splitting the deposits up into smaller amounts is also a crime, called ""structuring"".   On occasion there is a news story where a retail business that naturally must deposit cash from customers will be (falsely?) accused of structuring, e.g.:  Feds seize grocery store's entire bank account -- Institute for Justice defends grocer Under the legal doctrine of civil asset forfeiture, your money can be accused of a crime, seized, and tried separately from its owner.  The actual cases indicate the money as defendant, i.e. ""US v $124,700"" In this somewhat bizarre system of ""justice"", the owner need not be charged with a crime, and is not in immediate peril of going to prison (about the only upside in this, but might be temporary because the authorities haven't charged the owner yet).  When only the money is charged with a crime, there is no requirement for the government to supply a public defender for the owners who can not afford a lawyer.... can not afford a lawyer, because the government took all their money...." Yes. Although I imagine the risk is small, you can remove the risk by splitting your money amongst multiple accounts at different banks so that none of the account totals exceed the FDIC Insurance limit. There are several banks or financial institutions that deposit money in multiple banks to double or triple the effective insurance limit (Fidelity has an account like this, for example)