When Good Banks Go Bad

06Apr11

Rising fees on everything from current accounts to cash withdrawals, higher interests on loans, lower returns on investments – this is what happens when a good bank goes bad.

Thing like fees or dissatisfaction with customer service and opening hours are all things that can spur the consumer into changing bank accounts. Why not shop around? Different banks can offer lower fees and better rates – but before breaking up with your bank BEWARE! Don’t make the split more hassle or more expensive than it has to be. Here’s how to do it:

1. Ask your new bank or building society if they offer anything like a ‘switch kit’. Some try to make it simpler to switch bank account. Typically packs will come with forms to change direct debits as well as ones to let your employer know where to put your money in the future. Notice to your old bank can sometimes also be arranged, letting them know that you will no longer be requiring their sub-standard services.

2. Leave a ‘cushion’. Don’t close your old account entirely, at least, not yet. Leave a cash cushion in your old account to cover any payments you might have overlooked. Perhaps a magazine subscription, or gym membership. Leave the old account open for at least three months, or until you are totally sure that there is nobody left in the world with a claim on a piece of it.

3. Setup online accounts. Ensure that you can access your accounts online. Once you have done this you should check in on a daily basis. Make sure your employers are crediting to it, make sure your creditors are withdrawing from it.

The bottom line is that though banks may want you to think that it is a hassle to swith – it really isn’t! Don’t put up with bad banking behaviour, just vote with your feet!

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