Switching banks can be inconvenient, but most people are willing to do it if necessary. Over three-quarters (76%) of consumers are likely to switch banks if they find one that better fits their needs, according to a recent banking survey by The Motley Fool Ascent.
There are many banks to choose from, so it doesn’t make sense to stay with one that has unnecessary fees or subpar benefits. If you’re wondering whether you should make a change, here are some common reasons to switch banks right away.
1. You’re paying a monthly fee for your account
Your bank account should never cost you money. But many banks still charge those pesky monthly maintenance fees. This is particularly common with big banks, including Bank of America, Chase, and Wells Fargo.
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Monthly maintenance fees generally range from $5 to $15, although they can cost more. There are also usually ways to avoid them. For example, a bank may waive the monthly fee if you maintain a balance of at least $2,500 every day, or if you receive $1,000 in direct deposits per month.
If you’re going to use an account with a maintenance fee, make sure you can meet the requirements to have that fee waived. If not, pick an account that won’t charge you anything. There are plenty of quality checking accounts and savings accounts with no fees.
2. You’re earning less than 4% on your savings
One of the benefits of a savings account is that you can earn interest on your money. Interest rates have also gone up quite a bit over the last two years, but not all Americans have taken advantage.
The best savings accounts are generally paying rates of 4% or higher right now. Some are even offering over 5%. But the average is only 0.46%, according to the FDIC, because a lot of banks still don’t pay very much. At the big banks, rates are as low as 0.01%.
Less than a third (31%) of Americans have a savings account with a rate of at least 4%, according to savings research by The Motley Fool Ascent. If you’re one of them, you could be missing out on a nice return. If you have $5,000 in savings, that could earn you $225 per year in interest at a 4.5% APY — or $23, in an account with an average 0.46% APY.
3. You need more convenient ATM or branch options
You can do most of your banking online nowadays, but there may be some tasks you still need or want to do in person. This is where online banks sometimes fall short.
For example, when you need to get cash, it’s nice if there’s an ATM near your home or work. If the nearest fee-free ATM is a long drive away, then it may be worth looking for a bank with a more convenient ATM network. Or, you could go with a checking account that reimburses ATM fees.
If you like to be able to visit your bank, then once again, location matters. It could be better to switch to a local bank, if your current bank doesn’t have any branches within a reasonable distance.
4. You don’t like your bank’s web platform or mobile app
Some banks have invested heavily in technology, and it shows. Others not so much. They have outdated web platforms and mobile apps that are often frustrating to use.
If you dread logging in to your bank account, or you feel as if you can’t get anything done in its app, start looking for a more user-friendly option. SoFi is one bank that’s highly rated in this regard, both with its website and mobile app. I personally use and like Capital One. If you do a lot of banking on your smartphone, you may want to look at our list of the best banking apps.
You don’t need to settle for less with your bank account. If your bank is charging you fees or paying a subpar APY, or if there’s anything else you don’t like about it, it’s worth the time to make a change.
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