Breaking up is hard to do, so how do you know when it’s time to let your bank “go”? A recent survey conducted for Money Magazine found that the average American has used the same primary checking account for roughly 16 years. But moving to a new bank can actually be a savvy financial move.
There are many reasons to consider switching banks. Maybe you’re fed up with paying ATM or monthly fees. Perhaps your interest rate is abysmal, or you need better online account support. Whatever your reasoning, it’s time to take control of your finances with our ‘Break Up With Your Bank’ checklist…
1. Forewarn Your Bank
Like any break up, it’s courteous not to take your bank by surprise. By warning them of your next move you give your bank the chance to rectify their wrongdoings and let you know of any new offerings that might match what you’re looking for. You’ll rest easier at night knowing you gave the relationship your honest all.
2. Open Your New Account
As premeditated as this may sound, it’s a crucial step not to be overlooked. Why? By opening a new account BEFORE breaking up with your old one, you’ll be able to notify merchants of your new switch over. Plus you can’t switch banks unless you’ve got somewhere to go! Open your account at least two weeks before you plan on making the initial switch so you can have your card in hand and as well as online access, a working password, and your bank’s mobile app downloaded/set up.
3. Set Up Auto Payments and Direct Deposits
This is a necessary yet time-consuming step. Make sure you cover all your outgoings to avoid late payment fees.
- Direct Deposit. Your employer should have an easy form you can fill out to change your direct deposit information.
- Automatic Payments. Make a list of all of your payments that are automatically debited from your account. Then figure out which ones were set up through the company you’re paying, and which were set up through the Bill Pay system at your old bank. Be sure to set up the proper online payments through your new bank, and change the account information for payments automatically debited by companies.
- Paypal. Often overlooked, switch your banking information in any online payment systems you have set up.
4. Don’t Rush to Close Your Old Account
We’re not saying you should have an open relationship or cheat on your new account, but keeping your old bank account open for a short while has its benefits…
The switchover may take longer than you expect to update direct deposit and automatic billing instructions. By waiting a month, you can be sure that everybody is using your new account information. However, if you’re switching banks due to fees, you’re probably eager to close your account sooner.
5. It’s Time for the ‘Final Farewell’
Once step 1 through 4 are complete, it’s time to finally close the old account. Call your old bank or credit union and ask how to shut down the account for good, and be sure to ask for a letter that confirms the account was closed. You should also cut up old debit cards and checkbooks to be sure you don’t inadvertently use them later or become subjected to fraud.
If you’re not satisfied with the services you’re receiving at your current bank, don’t be afraid to make a change. Your finances are among the most important aspects of your life and taking control will be worth the hassle in the long run.
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