How To Switch Bank Accounts

Let’s explore how to switch bank accounts. Banks want you to feel locked in, and that switching bank account is incredibly difficult. In 2018 only 4% of Americans switched their bank account. I recently switched banks, and the great news is that it really is possible. We will go over the simple steps to switch your bank account below.

20% of Americans state they won’t switch bank accounts because they believe there will be too much effort involved. They also worry about incurring fees for switching bank accounts. There seems to also be a perception that it may have other negative impacts you don’t even know about. For this reason, people struggle to switch banks.

1. Research your bank account options

Ask your friends, family and co-workers where they bank. They will normally immediately praise their banking institution or let you know of their dissatisfaction. In the case of dissatisfaction, you can help them switch as well, once you have found the one. Listen to the feedback from the people in your life that are happy with their banks. Try and identify a few banks that are getting many positive responses. Then start looking at the bank fees, their benefits they offer you and if they tick all your boxes of the ideal bank. You will soon have it narrowed down to only a few good options. Then it will be time to make the commitment to your new bank as you can now start the process of how to switch bank accounts.

Depending on your personal preference, you may want to physically go to the bank to open the account. Or you may want to do it online. Some fantastic banks are now exclusively online and this allows them to reduce their overheads and offer you better perks to get and also keep your business.

Generally all banks, whether online or not will ask you for the following information:

Your identification document. It can be your driver’s license, your passport or even your state ID.

Your Social Security Number. In some cases the bank might want to see the card itself. But usually just the number will be acceptable.

Payment information for the opening deposit of the new account. The amount you need to deposit to open the account will be less at an online only bank. Make sure you are aware of this amount before choosing the bank.

2. Make a complete list of all automatic payments

You will now be updating your banking details with your employer or your clients so you can receive deposits into the new account. At the same time, you will contact all the different places you regularly make payment to and update the card or bank account details. During this process, you may notice some services or memberships you no longer need. It is a good time to cut down on unwanted expenses. To streamline this process of identifying your recurring payments, it is best to obtain your latest 12 bank statements. From there it is easy to see the places taking money from your account. These statements are usually sent by email, mail or can be downloaded from your online banking. Make sure you don’t miss any annual recurring expenses. In some cases, a payment is deducted once a year. For this reason, you are looking over 12 months of transactions just to ensure you don’t miss one. This is a very important step in how to switch bank accounts. Should you miss one and the payment does not go through, you will certainly be contacted by the institution and reminded of this. Then you simply update the details should you want to keep on using the service.

3. Close your old account

After 2 months you can go ahead and close your old bank account. It’s advised to give it 2 months just to make sure the transition is complete and you won’t be inconvenienced. To close the account you can phone the bank and ask if you have to visit them in person. If not, you can go ahead and close it by sending a letter or filling in the account closure request form. If you owe some money on the account, the bank will require you to make that payment before you can officially close the account. Should the bank owe you some money, they either give it to you in cash or write you a check or in some cases do a transfer to your new bank account.

Now you have successfully and carefully changed over to a new bank account. You can now give the new bank a try, and if you are happy with the service and perks, you can join the bank’s refer-a-friend program and earn a little something each time you help the bank sign up a new client.