The author, Jen Glantz.
Courtesy Jen Glantz
I almost felt married to the first bank I ever opened an account with, over 10 years ago.
However, over the years I’ve wanted to switch to other banks with better benefits and now I’m ready.
I want better interest rates, less fees, less rules about account minimums, and to open up a CD.
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It feels weird to say, but for so many years, I’ve felt married to my bank. I opened up my first bank account over 10 years ago, at the one that my parents used. I didn’t do any research, or compare offerings from other banks. I just made a quick, easy decision.
Many times throughout the past five years, I’ve wanted to switch banks to one that had better benefits, like minimal fees and a high-yield interest rate. When I tried to shut down my savings and checking accounts at my bank, I felt a sense of guilt. Did my loyalty matter? Was I doing the wrong thing?
But this year, I’ve realized I’ve had enough. It’s time to divorce my current bank and move all my remaining assets over to a new one. Here are five reasons why I’m ditching loyalty for better perks at a new financial institution.
1. I’m losing out on interest
One of the biggest reasons I’m eager to move my cash out of my current back and close down the account is that I’m losing money every single day on interest. Currently, my bank offers 0.01% as their savings account interest rate. Other banks that I’m considering offer a 0.5% interest rate.
When I look back at the passive income I could have been making over the last 10 years by just making a simple switch, I feel an even bigger sense of urgency to make the move.
2. I’m tired of the endless fees
It’s been really bothering me lately how many fees I’m racking up at my current bank. At the end of 2021, I had a $35 overdraft fee and a $15 wire transfer fee.
I try my best to manage my cash flow, but sometimes things happen that are out of my control. I’m eager to move to a bank that waives these fees so I can continue to manage my money without having to worry about getting charged extra.
3. I can’t always maintain the minimum average balance
One of the monthly headaches I face with my current bank — where I have not only personal accounts but my business accounts as well — is that they charge my business account a fee of $16 if I don’t follow their rules about the minimum balance I need to have every month.
To avoid that fee, I have to keep an average balance of $5,000, or use my business debit card to make at least $250 in qualified purchases a month. There are some months that I can’t do that and have to fight that fee. While I’m often successful at recouping the $16, it’s still frustrating to have to take care of.
I’d like to move to a bank that doesn’t have those rules and there are many that don’t.
4. I don’t need a bank branch anymore
A big reason I stayed loyal to my current bank is that a lot of the financial institutions I was tempted to switch to did not have physical locations and just existed online. I romanticized the idea of sticking with a bank that had branches in cities all over the country.
But the truth is, over the past two years, I have not had a reason to physically step foot inside of a bank. All of my customer service inquires or requests were taken care of over the phone.
Once I was able to experience a purely virtual relationship with my current bank, I realized there was minimal value for me to stay with a financial institution just because they offered an in-person experience.
5. I want to open up a CD as well
I’m a minimalist when it comes to managing my finances, and like to only have one main credit card and just one bank where all of my accounts live.
That’s why when I make the switch to a new bank, I want to open up a CD account with them and put a chunk of my money in it to take advantage of a higher interest rate. At my current bank, they are offering 0.05% for a 37-month term and at a bank I’m considering, they are offering 0.8% for a 60-month term.
Putting some money into a CD with a high APY at a new bank will make me feel like I’m taking better care of my finances than I am right now.
Personal Finance, Banking, Fees, Interest Rates, CDs, Personal Finance Insider, PFI Related Content Module, Freelancer, PFI GOBankingRates, pfi, PFI-XAMP
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