Switching banks is simpler than many people think. If you're ready for a change, but have been putting off switching to a better bank (one with higher interest rates, perhaps, or that doesn’t treat you like a number) because it seems like too much of a hassle, you may be relieved to learn just how simple the process is.
Opening a bank account at a new bank or credit union can be accomplished in five simple steps:
Step 1: Pick your new bank or credit union.
You want to make sure you switch to a better bank than the one you're at, so do the research first. There are plenty of community banks and credit unions that still offer free checking, some of which offer competitive interest rates as well.There are a few sites you can use to easily comparison shop for banks:
- Deposit Accounts – Compare different bank accounts side-by-side based on their rates and minimums for savings accounts, checking accounts, and other banking products.
- CheckingFinder – Search for banks and credit unions near you that offer free, high-interest checking accounts with benefits like ATM fee refunds.
- Bankrate – View rate data on around 4,800 financial institutions in the United States so you can easily compare the details.
Finding the right bank for you is the most important step in the process, but with resources like these it's easier than it's ever been before to make an informed decision.
Step 2: Figure out and collect all the information you need to complete the process.
Your new bank's website will probably tell you what you'll need, but you can always give them a call to double-check. The information you're most likely to need is:
- Your driver's license or state-issued ID
- Your social security number
- Either your checkbook, credit card, or debit card
- Your current and previous home addresses
Many banks and credit unions will let you open a checking account online, but if you feel more comfortable opening it in person it's worth making sure you know what you need before you make the trip.
Step 3: Fill out the application and any other required forms.
This step's pretty self-explanatory. The details will vary by institution.
Step 4: Transfer your money to the new bank account.
Based on the options available at your new bank or credit union, you may be able to do this via check, credit card, debit card, or a direct transfer.You don't have to move all your money right away, especially if you go with a Kasasa bank account, which requires no minimum balance. You can always start with just a little as a placeholder while you work to update any automatic direct deposit or billpay options you have set up.
Step 5: Close your old account.
While you may be excited to be rid of your old bank in favor of your new, better bank or credit union, you do want to be careful not to rush this step. You'll make your life much easier if you take some time to record all the relevant information stored in your old account, and update any automatic activities tied to it. This may include:
- Any direct deposits you receive
- Any automatic payments you make
- Bank statements for the last 1-2 years
Make sure you get down the relevant details like the dates and amounts of your regular payments, so it will be easy to add them to your new bank account. The bank statements will come in handy if you need to check back to an old payment for accounting purposes at a later date.
Still have questions about the process? Let us know in the comments, and we'll answer them as best we can.