How To Switch To A New Financial Institution

Monday, November 9th, 2020
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People choose to leave their financial institution for many reasons, including bad customer service or high rates. If you have chosen to switch to a new bank or credit union, there are some ways to make the process easier and less stressful.

Find the right one

The first step in switching financial institutions is to find the right one for your needs. There is a lot to think about, but some factors will be more important to you than to others. Here are some basic things to consider before switching.

Your unique needs

First, consider what you want out of your bank or credit union. Both banks and credit unions will offer checking and savings accounts, as well as debit cards, online banking, and mobile apps. Large banks may have more amenities, but smaller banks and credit unions will likely have more personalized service. Also, credit unions offer better rates on loans and other services.

Multiple accounts

Keep in mind that you can have multiple accounts at different financial institutions. That means you can choose to have a savings account at one bank and a checking account at another. If you can handle managing accounts at different places, this may be a good option for you.

Financial education

If you are not too familiar with financial health, consider a credit union. These institutions are able to provide personalized service to each member, including education on managing your money. Their focus is on their members, so you won’t be just another number.

Open your new account

Once you have chosen your new credit union or bank, simply open up your new account. Most financial institutions make this process easy. Some make the process available online, although this may not be convenient for everyone. Here’s what you can expect when opening your new account.

  1. You will need to provide information. This will include your name, a government-issued ID, your social security number, and your address.
  2. You might need to provide funds to open the account. This is true for credit unions, but the amount should be small.
  3. Your credit could be checked. Usually, this is done as a hard or soft check depending on if you are opening a card or loan with your account. They may also do this if you are signing up for overdraft protection.
  4. The institution will likely check your banking history.

Switch over your automatic transactions

Many people use auto transactions to make life simpler. From paying bills to purchasing subscription boxes online, the process is so easy you can actually forget about the payment. Because of this, you should remember to create a list of everything that has an automatic withdrawal before changing institutions. Don’t forget about your automatic deposits too!

Start your services

After you have made a list of your automatic transactions, make a list of services you currently use. Keep in mind that some credit unions and banks may offer different services. Common services include:

  • Banking alerts (text and email)
  • Mobile apps
  • Checks
  • Safety deposit boxes

You can start the transition process by opening your new account. You should also leave enough money in your old account to cover any expenses that have not yet come out. Next, update your information at your job so that you can get your checks deposited into the new account. After that (and when you have enough funds), go ahead and set up the automatic payments for everything in your account. Finally, follow the order of your list to finish all of the steps.

Close your old account(s)

Switching financial institutions can be simple if done right, but it does take time. You should wait to take this step until you are sure you no longer need to keep your old account open. Depending upon the bank or credit union, you may be able to close the account by phone or you may need to go in. Be sure to get a signed document stating that you have closed your account.

Want to learn more about credit unions?

If you are thinking about switching financial institutions, contact Borger Federal Credit Union today! We provide a variety of services that can help you take care of your financial health. Call us at (806) 273-9506 to learn more about our Services and becoming a Member.