The biggest reason why people don’t switch banks is fear. Fear that they’ll overlook something important while switching bank accounts, and that accounts will end up in collections, paychecks will sit in limbo and their credit score will suffer.
Make a Record of Your Automatic Payments and Direct Deposits
The first step you should take when switching financial institutions is to make a list of all the bills you pay using your financial institution’s electronic bill payment service, including how much you’re paying each month on average and the date each bill’s payment is due. This will ensure you don’t overlook any of your bills when you set up electronic bill payment services at your new financial institution.
In addition to writing down or exporting all of the items in your online bill payment center, go through two to six months of your bank statements to make sure you aren’t forgetting any bills that are due every other month. If you really want to make sure you’re not missing any payments, go through a full year’s worth of account statements.
You’ll also want to record all the direct deposits you have being made to your old account. Even if you only have one direct deposit, it’s better to record it now then realize you forgot to transfer it over after you closed your old account.
If you need help with this step, First Alliance Credit Union has a free downloadable switch kit you can use. It includes a section that will help you record your automatic payments and your direct deposits.
Download Any Important Transactions or Banking Statements
When you close down your old account, you’ll also lose the ability to access that account’s statements unless you download them. You’ll want to store at least six months’ worth of statements from your old accounts, in case you need to dispute charges or provide proof of purchase. These statements can also help you document your assets for a loan or insurance.
Link Your Old Bank Account With Your New Account
Once you’ve completed those two steps and have opened a new account, use the new institution’s online banking or mobile app to link your new checking or savings account with your old account, as well as any other active accounts you have. This will let you electronically transfer money between the two accounts. While this step isn’t strictly necessary, it will make transferring money from your old account to your new one much easier, and it can also come in handy if you need to transfer any money from your new account to your old one to cover a bill you forget to switch over.
Get Help Switching Banks With First Alliance Credit Union
While switching financial institutions can seem intimidating, taking some steps to prepare will make the whole process easier and less stressful.
If you need help switching financial institutions, including becoming a member of First Alliance Credit Union, you can find a lot of helpful information in our resource center. Our guide to switching financial institutions will walk you through every stage of transferring accounts, and our free downloadable switch kit has fillable forms that will make the process much easier.
If you want to learn more about switching financial institutions, listen to episode 29 of our Good Money Moves podcast where we talk about switching bank accounts.