When Is the Right Time to Switch Your Bank?

Many consumers continue to pay rising bank fees and new bank charges on their checking accounts and savings accounts for one of two main reasons. First, people will neglect to actually read their monthly statements and bank disclosure statements so they actually have no idea what they are being charged just for having an account. The second reason is likely due to the perceived complexities of having to switch from one bank to another.

There may be no ideal time to switch banks but there are some considerations to make about your banking practices in general. If you haven?t been in touch with the changes your present bank has made, now is a good time to do so. Here are some banking-related tasks you should consider:

See Where You Stand

Review the last few monthly statements you?ve received from the bank. Determine how much you are paying to maintain your accounts and what fees, if any, are new to you. You can only make good banking decisions if you know what you are now dealing with.

Start Some Research

If you are unsure what other banks are charging for the same services you use, start doing some research online and off. Local banks and credit unions will often advertise in the local newspaper or through mailed fliers. Make note of what other banks are offering that you are not getting with your current bank. Research the banks online as well to see what new options are available in online banking. You should explore the cost of services you already use such as checking account fees and other services you may wish to utilize in the future such as CD rates and lending options.

Try Negotiations

Once you are armed with information from your bank?s competitors, make an appointment with your current bank?s manager to discuss the services you need and the better offers available. Banks want to keep their loyal customers so some may be willing to accommodate you and match offers being made by other banks. They are not obligated to negotiate but it could save you some effort if they are willing to agree.

Preparing For Change

In the event you have found a better offer at another bank, it helps to start preparing early to ensure the transition is smooth and your money does not become tied up in the process. Here are some tips to prepare for the switching of banks:

Open the New Account

Start the process of opening the new bank accounts with a minimum amount of money, leaving your other checking accounts open and supplied with cash as normal so you can begin the transition. Be sure to get the account data for all new accounts so you can start making the transition with your creditors and other financials.

Account for Your Accounts

Because technology has allowed us to do so much more online and through automated services, you need to take some time and find out where you need to make changes. For instance, write down all of the online accounts you pay through your bank card automatically. You will need to contact each company individually to change the bank card information on file; otherwise you can mess up your timely payments. You will also need to change any direct deposit information with your human resource department at work. If any payments are automated each month, be sure to provide the new bank information and effective date so the transition won?t interrupt your payments.

Finalize Old Accounts

Your old bank will likely not allow you to close out accounts until they are certain everything has cleared. Find out what the time line is for account closure and keep adequate money in the account until that point. If something you have forgotten gets processed, you may risk overdraft charges. You?ll need to pay close attention to your accounts and money management until your old accounts can be closed and you can move forward with your new bank.

There are many long-time banking customers who are finding out just how much banking services are costing them in a year?s time. Even though they have been with their bank for 20-30 years, they can no longer justify the high cost of banking fees they face with the larger banking institutions. If you find your current bank is treating your fairly and fees are reasonable, always keep in touch with what changes are being made. With the new changes to banking regulations, changes are likely going to continue and you need to protect your interests and personal financial life by keeping up with this information.

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