The recent announcements by banks to raise usage fees or introducing new fees to already existing accounts have many consumers up in arms. This brings you to the point where you may be considering changing banks to find options with lower fees and more reasonable terms. It is important to remember that you are a customer at a bank, and if you do not agree with the terms of service or the product offered you can change whether or not you do business with them.
Before you decide whether or not you want to close your account completely you should consider the reasons you originally chose the bank or opened an account. For example you may have opened the account there to set up an automatic payment so you qualified for a lower interest rate on a car or student loan. You may also be required to keep a checking account there because of the loan. You have the option of refinancing, but you may save money by keeping your account open at the bank until your loan has been paid off.
If you chose the bank because of the convenience of a large bank and the ease of finding an ATM then you should ask yourself if switching to a smaller bank with fewer ATMs will help you come out ahead each month when it comes to ATM fees and other charges. For example if you travel a lot and use ATMs on a regular basis, the $5.00 debit card fee that Bank of America is now charging may wash out the fees you would pay if you were force to use another bank’s ATM. However, if you just use your debit card and do not use ATMS it may not play a factor in your decision to switch.
Deciding to switch banks is not something to do lightly. There is a lot of work involved in switching over your account. You will need to open a new account at your bank, then switch all of your debits, and automatic drafts over to the new account, plus change any direct deposits before you close out your old account. When you shop for a new account you should look for a bank with several locations that are easy to get to. You may move and you may change jobs, and you may need to change banks again if there are only one or two branches in difficult locations. You should also consider choosing a credit union.
If you are stuck at your bank to save interest on your loan, then you have a few alternatives, depending on the situation and terms of use at your bank. One option is to open a new account at a different bank or credit union, and to do most of your banking through that account. You can then cancel your debit card with your account and transfer the money to your old account for the automatic payment each month. This will allow you to get the lower interest rate and may save you the cost of increased fees. You can refinance the loan at your new bank or you can pay off the loan more quickly and change banks after that.
Banks do have the right to change the terms and conditions of their accounts, but as a customer you can choose to leave and open your account at another financial institution. Remember to read the fine print in any account disclosures you receive in the mail and when you open your new account. This information can help you save money in the future. You should shop for your bank just as you would shop for any service provider you use.
