There could be a multitude of reasons as to why you’re thinking about leaving your bank. Some main reasons include, better customer service, a higher APY/Interest rate, lower fees, and better benefits.
No matter the case, the closing process shouldn’t defer you from doing so! As everything is becoming more and more integrated with one another, it’s now easier than ever to sign up for a new account without having to actually go to the branch.
Now this leaves you with the issue of how to close your account at your current bank. The first step is to choose a new bank, decide what features you want, open the account, and lastly close your old account. This may seems hectic and a hassle to leave, but I’ve composed a list that will make it as easy as possible! So if you are interested on how to switch banks then keep on reading!
Table of Contents
Choosing A New Bank
What’s important to you in a bank varies from person to person, however there are a few key points that you should keep in mind while you’re deciding which bank to switch to:
- Choose a place that has nearby/local branches and ATMs simply for convenience.
- Compare competitive rates for accounts such as CD’s, Money Markets, Interest Earning Checking Accounts, Saving Accounts, and lookout for low fees. There are many rates out there so make sure you know the differences between an APY & Interest Rates. (Also browse our Best Savings Rates list to find a savings account that is best suited for your needs)
- Remember that you don’t need to have your accounts all in one place. As a matter of fact, many people have accounts scattered from one bank to another depending on a variety of factors such as a lower monthly fee. However, if having all of your accounts in one place is important to you then do your research and make sure you’re getting the most out of your money!
- Keep an eye out for the credit inquiry, the last thing you want is to hurt your credit score from simply opening an account. For instance, if the bank does a Soft Pull then it won’t impact your credit, but if it is a Hard Pull then prepare to see your score dip a bit. Also remember that a hard pull may occur if you opt for overdraft protection.
- Also, if banks aren’t for you then perhaps you should look into credit unions. Learn more about the Advantages & Disadvantages of Credit Unions!
In short, you should be looking for these specific things when making your decision on a new bank.
- Monthly charges and overdraft fees
- Minimum balance requirements
- Online bill pay and electronic payments options
- ATM access and fees
- Bank debit card or credit cards availability
- Checking or savings accounts’ interest rates
- Customer service ratings from the Better Business Bureau
With these things in mind, also note that banks often run new-customer promotions with offers that range from bonus airline miles to $1,000 bonuses just for opening an account with them. All you have to do to find the latest bank bonuses is to check their website or our List of Bank Account Bonuses!
When Does Switching Banks Make Sense?
Some signs of when its time to consider switching banks may come in many forms. Perhaps the bank you’re currently banking at has bank fees that are too high or you are dissatisfied with their customer service. Depending on your banking habits, you might even want to consider switching to an online bank. Although there aren’t any physical locations, you can earn higher interest rates.
Even if you find a new bank that can still offer the same services as your old one, the new-customer sign up bonuses might make it worthwhile to switch. Depending on the number of direct deposits, automatic billing and subscriptions you have set up in your existing bank account, switching banks might be fairly simple to do.
List Out Payments, Deposits, & Fees At Your Old Bank
- No matter the reason why your’e leaving your bank, you need to sit down and note all of the automatic payments, reoccurring deposits, and annual fees.
- The last thing you want is to be dinged for something that could have been prevented by simply taking a look at your bank statements.
- Also remember to cancel any text alerts, email alerts, paper statements.
- No one wants to lose their hard earned money, but there are Ways to Avoid Excessive Bank Charges.
Open Your New Account
It may seem very tempting to close all of your accounts at your bank, but you shouldn’t be so hasty. Unless you’re able to pay cash for everything, then you’re going to find yourself in a predicament when your’e left without a basic checking or savings account. Instead, simply pay careful attention to the pros and cons of the account that you’re interested in and learn Ways to Get the Most Out of Your Bank.
- Make sure you have enough money in your old account in case some payments or checks haven’t been cleared.
- Find out if there are any monthly fees and if there are, see if they’re easy to avoid. For instance, some banks will waive the fee if you complete a monthly requirement such as maintaining a certain amount in your account.
- Update your basic information as soon as possible to ensure that your statements, bills, and direct deposits are all going to the correct place.
- Lastly, do a thorough double check to see if you forgot to do anything else such as ordering checks, renting a new safe-deposit box, and downloading your new bank’s mobile app.
Close Your Old Account
- Once you have chosen your new bank, weighed the pros/cons, ran a double check on any fees, and opened your new account, then it is time to close your account!
- It is recommended that you get a written document confirming that your account has been closed because according to a 2012 report by Consumers Union in Yonkers, New York, some banks will reactivate closed accounts in order to fulfill an automatic payment/deposits.
- If you have any further questions about the closing process make sure that you contact your old bank.
- Congrats you’re all done; you’ve successfully switched banks! Now it’s time to enjoy your new account at your new bank!
Whether your reason for leaving is due to the bad customer service, mediocre rates, or high fees, it is important that you know how to properly leave your bank before you join a new one. Taking a few precautions can save you a lot of time and money, so don’t be hasty! Just sit down and thoroughly review your current situation before you make the switch!
Once you do so, take our how to switch banks steps compiled above to help the process run smoothly! If you would like to see more, check out our full list of Bank Bonuses for all your banking needs.