Should you switch to a new bank?
Your bank is one of the financial institutions you have the most interaction with, as chances are good that most or all of your money passes through it at some point.
But despite that fact, many people don’t really take the time to think about whether their bank is working well for them. If you’ve stuck with yours by default for years, the new year may present a good opportunity to make a change if it’s no longer the best fit.
So how can you tell if you should be looking around for a new banking relationship in 2021? Just watch for these four signs.
1. You’re paying high fees
Some banks charge for everything, from using an ATM to viewing copies of your past checks. If your bank is one of them, you should seriously consider whether it’s worth paying for all of these services when there are so many fee-free options out there.
Check over your bank statements for the past few months. If you find you’re wasting tons of your hard-earned money on bank fees, consider looking for a financial institution that won’t charge you just for being a customer. Often, online accounts come with lower fees than their brick-and-mortar competitors, but you can explore all different kinds of financial institutions to see which is the best bank for you.
2. Its mobile app is lacking
In the time of COVID-19, a full-featured mobile app is more important than ever. If your bank’s app lacks key features such as the ability to deposit checks over the phone or to get text alerts when your balance gets low, you may wish to consider switching to a financial institution that offers this modern functionality.
Some banks also have apps that are just nicer to use than others. Since chances are good you’ll mostly be interacting with your bank over mobile for at least several more months in 2021, look for one that will make the experience pleasant instead of turning it into a major hassle.
3. You aren’t earning any interest
This is most important if you’re looking for a bank where you’ll hold your savings. But there are a number of checking accounts that also pay interest. If your bank doesn’t pay any interest for a checking account or the interest rate on its savings accounts isn’t very competitive, it’s worth looking into alternatives.
4. You have a high minimum balance
It’s very common for banks to impose minimum balance requirements — and charge fees if you don’t meet them.
The problem with this is that you’re stuck choosing between leaving your money in a checking account where it doesn’t do very much for you or paying a fee for storing your money. You probably don’t want to do either — especially if your minimum balance requirement is fairly high and you find yourself tying up a lot of cash that you could be doing other things with.
There are a number of banks that have no minimum balance mandates — especially if you’re willing to set up direct deposit. If your financial institution isn’t one of them, consider looking for a different one.
While changing banks may seem like a hassle, it’s definitely worth considering if any or all of these red flags apply to your current bank. Don’t get stuck with a bad banking relationship for another year — make it one of your resolutions to switch to a bank that treats you better.