Bank not measuring up? How to tell and what to do.
After eight years as a customer at a big bank, Victor Villegas cut ties over an $18 fee.
鈥淚 looked at the benefits that other banks offered,鈥� the instructional designer in Dallas says. 鈥淚 realized that I was getting the short end of the stick in the banking relationship.鈥�
It鈥檚 not a聽move many people聽make. In 2014, the EY Global Consumer Banking Survey reported that 60% of customers had no plans to move accounts within the next聽year, and it wasn鈥檛 always because they were satisfied. For example, 17% said that聽it was too difficult or time-consuming to change banks.
But not聽switching could be costly.聽If you haven鈥檛 looked at what your financial institution鈥檚 competitors offer, you might be getting the short end, too.
Take stock of your financial needs
Your financial聽needs can change with time, and you won鈥檛 know if your bank is still the best one to meet yours聽unless you browse your options. You might find聽free accounts, low fees, more promising savings rates or better budgeting tools.
According to the same Global Consumer Banking Survey, 32% of customers who had closed bank accounts within the last year did so because of their bank鈥檚 rates or fees.聽You might also want to change banks because:
- You got married (or divorced).聽It鈥檚 a fresh start, so try something new:聽a聽joint account at a bank that meets you and your spouse鈥檚 needs or a personal checking account with the features you want.聽
- Your bank鈥檚 customer service fails to impress.聽Walk away if your neighborhood聽branch closed down, the call聽center鈥檚聽hours don鈥檛 work with your schedule or you鈥檙e consistently met with a poor attitude.
- Your bank doesn鈥檛 have your must-have features.聽If your bank lacks a decent聽, mobile check deposit capabilities, person-to-person money transfers, a digital wallet or budgeting tools, those are all valid reasons to leave.
You can聽also return to your old bank聽later. Charlie Lucero, a registered nurse in Santa Clarita, California, left his bank because he didn鈥檛 think he was properly informed about the fees attached to his account. He returned because his job suddenly qualified him for a free account.
Your relationship with your bank doesn鈥檛 have to be long term. If you鈥檙e unhappy or think you鈥檇 be happier elsewhere,聽move on.
Research your聽options
And you don鈥檛 need to switch to another traditional bank. Technology gives you聽alternatives, such as聽. These offer聽low fees, high interest rates on savings and strong digital experiences 鈥� but they don鈥檛 always accept聽cash deposits or have physical branches.
Some consumers also turn聽to聽. They have fees of their own, but a 2014 study by Pew Charitable Trusts reports that about one-third of prepaid card users closed a checking account because of overdrafts or bounced check fees.聽
Villegas created a聽system that works for him. He now has accounts at two banks for different purposes: an online bank for perks and a brick-and-mortar bank for its large ATM network.
You can do the same 鈥� or use another strategy. Feel free to mix and match institutions as you please.聽
Open your new account
One thing to note: Make sure changing banks will solve your problem. For three years, former bank teller Karlie Flores watched customers switch banks when banks changed policies in response to federal regulations. According to her, some customers didn鈥檛 understand that they would be met with the same requirements at any bank.
Once you鈥檙e ready, opening聽a new account can take as little as a few聽minutes online 鈥� but the other steps聽will take more time.聽Your old bank might require you to make a phone聽call, fill out paperwork or visit a branch to close an account. You鈥檒l also have to reroute any聽direct deposits or automatic bill payments.聽Taking the right聽聽can minimize obstacles.
It may sound tedious, but if you鈥檒l save聽money, it could be worth it.
Melissa Lambarena is a staff writer at NerdWallet, a personal finance website. Email:聽mlambarena@nerdwallet.com. Twitter:.
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