Nearly one in five checking-account holders considered switching banks in the last year because of fees, poor customer service and lackluster rates, according to a recent Consumers Union study. But fewer than half of them actually made the switch, because they found the process too difficult.
If you’re thinking about switching to a bank that lets you better manage your money, consider the following tips for making a hassle-free move.
Choose Your New Bank
Don’t close your bank account without having another account where you can put that money, Wise Bread advises. Look for a financial institution that offers services, products and policies you need. Wise Bread recommends examining ATM-fee policies, as well as all the accounts’ terms and services, such as minimum-balance requirements, and whether they offer free bill-pay, when researching a bank.
If you’re looking for a bank with customer-friendly policies, consider Ally Bank. Our Interest Checking Account has no monthly maintenance fee or ATM fees. We also reimburse all ATM fees that other banks charge you, nationwide.
Set Up Your New Account
Once you’ve selected a bank, open your new account. One of the benefits of banking with Ally is that there are no minimum balance requirements, so you can open your new account with any amount.
Money Crashers recommends leaving enough in your old account to keep it open for now. One of the key steps in setting up your new account will be shifting your direct deposit and automatic payments from your original account. This may take time, but it’s crucial to make sure you don’t incur overdraft fees.
One thorough way to do this, Wise Bread suggests, is to export your last two months’ transactions into a spreadsheet, in order to get a clear picture of everything that regularly goes into and comes out of your account.
Also, find out if your new bank has a fund-holding period, Wise Bread says. A new bank that has a policy of, say, a two-week hold on deposits could leave you in the lurch. If your new bank has such a practice, you may want to continue holding some money in your old account until the new bank clears your deposits.
Close Your Old Account
Wise Bread suggests leaving your old account open for another month after you’ve switched banks, to make sure there are no forgotten automatic withdrawals or uncleared checks. Once you’re certain you’ve moved all automated deposits and payments, you’re ready to close the account.
Money Crashers advises you to call your bank first to find out how many forms of ID you need to close the account, or whether you’ll have to pay any fees for taking your business elsewhere. And although your bank may try to convince you to stay, if you’ve truly found a new bank that offers you better products and services, you can feel confident that walking away is the right decision.
If finding a bank that’s better than the one you’ve been with seems like a pipe dream, think again; MONEY Magazine recently praised Ally’s interest rates and named us the Best Online Bank for the second year in a row.
What policies have made you consider switching banks? What obstacles have you encountered in switching?