Tips & Tricks to Switching Banks and Saving Money

Are you one of many who aren’t happy with your bank, but the thought of dealing with direct deposits and automatic payments keep you from switching? We feel your pain. To make this process simpler, we’ve created a handy step-by-step guide to help you move money from your old account to a new one, neatly tying up all the loose ends and saving you money.

Leaving Your Current Bank

Whether it’s your day-to-day banking, your savings and retirements, or your mortgage, banks are there to serve you. When your bank isn’t giving you what you need, it might be time to consider other options.

Poor Customer Service

At first, your bank might offer a great experience along with attractive perks, but you’ve noticed their service hasn’t been up to par over the years. Some customer service features you might want include:

• A good range of customer service hours for in person and over the phone.
• Positive face-to-face interactions.
• Quick resolution of issues.
• Branch amenities like ATMs and in-house services (ordering checks, making deposits, checking balances, transfers and etc).

Stay if you can talk to the branch manager about the bank’s customer service. They may be able to address the issue and improve your banking experience.

Move on if the manager doesn’t seem interested in making your banking experience better. When looking for a new bank, check their hours, the amenities offered, and their website for customer support. We also recommend looking at online customer reviews to see what others are saying.

Lack of ATMs & Branches

Some banks charge up to $4 each time you use an unaffiliated ATM, so the cost of access to these machines can add up quickly. Make sure your bank has plenty of ATMs to use and know where to find them.

Stay if your bank’s ATMs are located near you. You can also find ATMs that will allow you to withdraw cash without any fees.

Move on if you prefer to pay with cash but find yourself regularly paying ATM fees. Choose a bank whose ATMs you hit the most.

Ridiculously High Fees

While you can’t avoid banking fees, some banks charge higher fees than others (ie: $35 for an overdraft, yikes!). Certain institutions might charge other unnecessary fees – like maintenance fees, minimum balance fees, paper statement fees and human teller fees – while others offer all these services for free.

Stay if you can ask your bank to forgive your first overdraft or late fee. A good bank wouldn’t mind refunding this fee if you’ve never done it before. However, this will probably only work once.

Move on if your bank is charging you for services that other banks are offering for free. Before you sign up with a new bank, read the fine print and customer reviews so you know what to expect.  

You’re Moving

If there aren’t any branches in your new area, then you’ve got to open a new account. Otherwise, you’re looking at a not-so-convenient, long-distance relationship with your bank.

Stay if there is a branch in your new location, or if you can do all of your banking online. You could decide to keep a savings account open if you’re really keen on your current bank and its services.

Move on if there are no branches nearby and you can’t really do your banking online.

You Want a Joint Account

When you get married, you and your partner will probably want to open a new joint account, which might not necessarily be with your current bank.

Stay if you have several accounts at your current bank, and they offer excellent customer service.

Move on if your partner’s bank, or another bank, has better products, services and amenities. Since you’re opening a new account anyway, it’s a good time to switch banks.

Lack of Online Services & Features

If your bank doesn’t have the online services and features you want to manage your finances effectively and efficiently, you’ll want to consider another option. Online services you might be interested include:

Stay if your bank has online services and features. If you’re not sure what your bank offers, sign up for an online account or call customer service for more information.

Move on if your bank’s lack of online services and features make managing your finances inconvenient.

No Loyalty Perks

If you’re a long-time customer at a certain bank, you should be rewarded for your loyalty.

Stay if you speak to a bank rep and they offer you the same perks that a new customer gets. You might get your annual account fee waived simply by asking if you could get the same deal advertised to new customers.

Move on if your bank isn’t willing to reward you as a long-time customer. This shows they don’t value your loyalty.

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Finding a New Bank

You’ll want to do this step carefully. A bad fit means you might have to start your search all over again and go through switching your accounts yet another time.

Begin by making a list of services and features you prefer your bank to have. You probably won’t find one that ticks all your boxes, but you could get close. For example, you might settle on a local bank that doesn’t have a nationwide network of branches but has lower fees if you don’t travel much anyway.

When you’ve trimmed down your options to a few candidates, take the time to read through the checking account fine print. What fees do they charge? Is there a balance requirement? Are there any special deals?

When choosing your new provider, you’ll want to consider fees, interest, convenience and if the bank is insured by the FDIC.

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Switching Accounts

Once you’ve settled on a new bank that can better serve you, you need to move money from your old provider to your new account. This part may seem like a pain, but I’ve broken it down for you in several easy steps below to make the process as easy as possible.

Open Your New Account

With the Patriot Act, you’ll be required to provide the following:

• Your name, address and date of birth.
• Official photo ID (driver’s license, state ID or passport) or two forms of official non-picture ID (Social Security card, birth certificate, etc).
• Your Social Security number.
• An opening deposit in the form of cash, check or payment information (account number and nine-digit routing number for an existing bank account with a balance big enough to cover the amount).

Cancel Automatic Payments

If you pay bills automatically from your old account, login to your account online and cancel those payments. Keep a list of account numbers, payees and amounts so you can set up those same exact payments with your new bank.

The same goes for services that are automatically billed to your bank account or attached debit card. The easiest way to go about canceling these payments is to look at your recent billing statements and find the regular charges. Visit the service’s online portals to change the payment from your old account to your new bank account or debit card. You’ll want to make sure you get the services that auto-renew, and any quarterly or biannual payments, like insurance.

Transfer Cash to New Account

Either bring a certified check to your new account for deposit or wait until the wire transfer is complete.

A certified check can tie up your funds for about three days, so if you need the money right away you should request a wire transfer. Certified checks are usually free, but wire transfers incur fees.

Set Up Direct Deposit

If you receive direct deposit from your work or another source, you’ll need to set that up with your new account. Provide a canceled check from your new account to your employer’s human resources department, or submit your new account and routing number.

Set Up Automatic Payments

Remember all that information you wrote down when you were canceling automatic payments with your old account? Use this information and your new bank’s online tools to set these up again.

Close Your Old Account

With your money moved to your new account, you can now contact your old provider to let them know you would like to close your account. You’ll probably have to visit the branch in person to sign some paperwork and present your ID to officially cut ties. Call ahead and ask what you need to bring with you.

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Bottom Line

Sure, breaking up is hard to do. But when money is involved, your satisfaction and convenience should be your top priority. With so many fish in the sea – from big banks to local credit unions to online providers – there’s no reason why you should stick to an institution that’s not performing as well as you’d like. Give your current bank a chance to rectify your issues with them. If it doesn’t work, make a clean break with the tips we’ve given you.

Read more: See the best bank promotions here and the best investing promotions here.