The Easy Guide to Switching Banks

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Switching Banks

Switching BanksUnhappy with your bank? You’re probably not alone. Many consumers are interested in switching banks so that they can earn better yields, avoid the fees that many banks charge, or get better service.

If you are planning to switch banks, Forbes offers a simple and straightforward guide to making it happen in five steps:

Comparison shop: The first step is to look around. Thanks to the Internet, this is easier than ever. There are a number of sites you can use to compare banks, including fees and other items. Look for what will work best for you.

Don’t forget the little guys: Forbes suggests that you look at community banks, online banks, and credit unions. You could be missing out if you just go with the big guys. You can enjoy a better relationship, and lower costs, when you look at these smaller options.

Open your new account: Now that you have chosen a new financial institution, it’s time to open an account. Once you open an account, make sure you set up automatic transactions. This means adding direct deposits, as well as setting up automatic payments for loans and other services. Make a list ahead of time.

Move your money: First, you need to coordinate which outstanding automated payments will be coming out of your old account. Leave enough money to cover those items and then move the rest of your money. You can use electronic transfer or certified checks. You might need to have both accounts up and running for a couple of months to get everything taken care of properly.

Close the old account: Finally, it’s time to close your old account. Make sure you fill out the paperwork, since just drawing down the account is insufficient — especially if there are fees associated with having a low balance.

With a little planning, it’s possible to create a smooth transition to a new bank.

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Miranda is a freelance writer and professional blogger specializing in financial topics. Her work has appeared in numerous media, online and offline. Her blog is Planting Money Seeds.