Options, options, options. Just like the cereal aisle at a grocery store, you have options when it comes to choosing a bank account. Sometimes we switch banks because we are tempted by a higher interest rate. Other times we are just fed up with fees at our current institution. For still others customer service is important.
Whatever the case for you, here are some great questions to ask yourself before you choose your next bank. Do yourself a favor, and choose a better bank!
Questions to Ask Yourself
1. Why am I really switching banks?
We've already given some of the simple answers: interest rate, fees, etc. But ask yourself a deeper question: why am I really switching banks? Don't merely switch banks because you will get a small reward. Switch banks because you believe it will cause significant change in the way you handle your finances. Sure, rewards are nice, but make sure the reward is worth the effort.
For example, the last thing you want to do is switch banks because they offer 0.02% higher of an interest rate. That's so minuscule, you'll barely notice the change. Was it really worth the effort to switch banks?
2. Will changing my bank significantly change my financial routines?
As many of you know, many new banks out there are now online only. Recently I posted a review article of PerkStreet vs. Ally banks . . . both institutions are online only! No branches! For those of you who like face to face contact with your bank, these banks won't work very well. But if you're looking for great rewards, they have them!
Choose a bank based on your own desires. If you're spending a lot of cash during the month, choose a bank with ATMs close to your location. If you're a debit card user, you might be able to get away with an online-only bank like PerkStreet.
3. What does it cost to get rewarded by the new bank?
If you're switching banks to get some new perks, ask yourself what it costs to not only switch banks, but to get those perks once you switch! For example, some banks require that you hold a certain balance in your checking account before you can get rewarded. Find out what those requirements are before you switch.
Read Some Reviews
You can find a better bank by searching Google. There are many reviews out there (here's an example) that will go into detail on just about every aspect of a bank. Look for reviews that are lengthy and thorough; 1,500-word reviews are excellent.
Start out by listing some banks that seem interesting to you. Then type into Google “[insert bank] review.” Chances are, you'll find two handfuls of reviews. Some of them are going to be better than others. If the reviewer has personal experience with the institution, you can regard that review as better than many others.
Too often reviewers are writing their review without ever having tried the bank out. This isn't necessarily a horrible thing, but it helps if the reviewer has some experience or has interviewed somebody who does.
Seek And You Will Find!
I encourage you to go out there and look for another bank if you are frustrated by your current institution and think there is something better out there for you. Here are some tips for knowing you have found the right bank for you:
- When you will get at least $50 extra in cash back from your bank per year. This is a significant amount. Don't settle for less.
- When it fits your current financial routine or improves it. Maybe you're tired of driving to the bank to deposit checks, and an online bank allows you to scan your checks and deposit them electronically. Whoa, wouldn't that be cool?
- When your spouse agrees that it's indeed time to change banks. I call this one the “spouse test.” If they are for it, and you're for it, you probably should do it. If they are reluctant, think again! Besides, you're in this together, aren't you?
Do you have a favorite bank? What are you looking for in your financial institution? Meet us in the comments and let us know!
NOTE: Check out our bank rates page for rates from a variety of great online savings, checking and alternate account types, as well as links to reviews we've done of them. Bank Rates And Reviews