If you’ve wanted to change banks for a long time or are currently in the process, you’re not alone!
Government regulation has made banks less hospitable to the average retail banking customer. The added cost of regulation, oversight, and compliance means that most banks lose money catering to the average banking customer who just needs a simple checking and savings account. The banking system favors the little guy less and less each year.
Regardless of your reason for changing banks, follow these simple tips to make the transition a smooth one:
1. Find a new bank
Consider banking fees, proximity to your home and work, online bill pay, and customer service. These factors are all important, but some will matter more to certain customers than others. Be sure that the new bank you choose is conveniently located and has all the features you need.
2. Open a new account
This involves some simple paperwork and a few signatures. Government regulations make this process more time consuming each and every year, but it’s not too difficult to get through at the end of the day.
● Note the name and title of the person who helps you. It will be easier to have one point of contact if you have issues than trying to navigate a customer service phone robot.
3. Expect to wait for access to your funds, especially large amounts
Your old bank and new bank will have to work out the finer points of settling their accounts. This should only take a day or so for large national banks, but if one of the banks is a small local bank or credit union it may take more time.
4. Set up direct deposit
Contact your human resources department and give them your new account information. You should only need a cancelled check in order to fill out the paperwork. Depending on your employer, it may take one paycheck cycle to get the direct deposit flowing into your new bank. Many banks require a direct deposit in order to waive their monthly maintenance fee so getting it set up as soon as possible is a must.
5. Consider a balance transfer on your credit cards
For simplicity, it can be nice to have every account at the same bank. Consider the advantage of having your credit cards and loans all at your new bank. You may even be able to get a more favorable interest right as well.
6. Move automatic bill payments over to your new account
For electronic bill payment, move your monthly payments over to the new bank. For any payments automatically deducted from an old account, notify those creditors and provide them with the new account information.
7. Close your old account
With everything set up at the new bank, you can safely close your old account. Be certain that any checks or other outstanding payments have cleared the account before you close it. Your old bank will do everything they can to talk you out of it as they never want to lose deposits. Be polite, but firm in your decision.
8. Provide feedback
You’ll be asked why you’re closing your account. You might as well tell the truth. Tell them that the fees were too high or that the interest rates are better at the new bank. Your feedback it unlikely to change anything, especially for you, but if enough people feel the same way, your old bank may change.
Opening a new bank account can feel like an overly detailed process, but it’s better to bank with a company you trust and enjoy being a customer of. Define your needs and find a bank who can meet them. Following these simple steps will make for a smooth transition.