How To Successfully Switch Banks

Making the decision to switch banks can be overwhelming. But you shouldn’t have to deal with a financial institution that has bad customer service, charges unreasonably high fees, or fails to offer valuable features and incentives. There is a better bank out there for you.

The process of making the switch can be stressful. Here’s how you can smoothly make the switch.

Make A Plan

Making a plan will allow you to close your current bank account, open a new account at your next bank, and prevent any delays in making payments or receiving deposits.

You’ll want to make a list of direct deposits linked to your account, as well as payments you make with it. Take note of any subscriptions or automatic payments so there are no interruptions to any of your services.

This list will allow you to keep track of each payment and deposit to your new account. It’s a good idea to plan out the switch after a bulk of your payments and deposits take place so there’s plenty of time for your employer, and you, to make changes.

Pick Your New Bank And Set Up An Account

Set aside some time to check out different banks and make comparisons. Look through bank websites or schedule appointments to get informed about overdraft protection, online features, and any monthly fees. And see which ATMs and bank locations are most convenient for you.

If you have a credit card linked to your previous bank, ask about what kinds of credit cards are offered. It’s often more convenient to manage and pay for credit cards within the same financial institution.

The quickest way to open your new account is through the bank’s website. All the steps to follow should be provided for you online.

You can also visit a bank location to open your account. You might be asked for a government-issued ID, proof of address, a Social Security number, and a minimum deposit. Check in advance for any other requirements.

You’ll have some paperwork to fill out and an agreement to sign. Read your agreement very carefully before signing.

Link Bank Accounts

Linking your old and new accounts makes moving your money and payee information a breeze. This can be done on the bank website or in your old bank’s mobile app.

You’ll enter your new account information and make a transfer of just a few cents from your old account to the new one. This small transfer should be confirmed by your bank in just a couple of days and lets you know the two accounts have been successfully linked.

Automatic Payments

The next step is to set up your automatic payments, and payment systems like Venmo and PayPal, with your new bank details. You should also let your employer know your new banking information if you are paid through direct deposit. Do this as soon as possible since it takes some time for this to be processed.

Update all of your sources of income like pensions, annuities, and other government benefits. And be sure to turn off automatic payments from your old account to avoid payment delays or cancellations.

Because automatic payments take time to move up to your new bank account, it’s a good idea to wait about a month to let these places verify and process your new account information.

Eventually, all automatic payments will be charged from your new account and you’ll receive all your deposits there, too.

Transfer Most Of Your Funds

Once you’ve smoothed out all the details in regard to direct deposits and automatic payments, you can safely transfer most of your funds from your old account to your new one. It might be wise to leave just a bit of money in your old account in case any forgotten transactions get processed.

You can move your money over with a wire transfer or with a service like Zelle. Be mindful of fees before you send anything over and check if there are minimum balance requirements with your old bank. You’ll avoid fees and penalties by double-checking.

Close The Old Account

Once you know all your bills and deposits are moved to your new account, you can safely close your old one. You can call or visit a bank branch to do this. Research any fees or documents needed to proceed.

Switching banks can be a huge hassle. But if you flesh out a plan, inform yourself to keep this process at a low cost, and monitor the process closely, the road to a new bank is easier than you think.