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How to Change Your Primary Financial Institution


Banks and credit unions want your business, and many offer new customers great perks like ATM fee reimbursement, totally free checking accounts, even cold hard cash. Problem is, swapping your primary financial institution isn’t as easy as, say, changing shampoo brands. Nonetheless, with a little planning, moving your money to a new bank or credit union doesn’t have to be a hassle.

If you want to switch to a new bank or credit union, follow these steps to ensure a smooth transition.

1. Open the new account. Once you have chosen your new bank or credit union, open an account there before doing anything else. Most institutions will let you open the account with an application and an initial deposit of between $1 and $100. You can fund the new account with cash, or a check or electronic transfer from your old account.

2. Order your debit card and checks. If you still use paper checks, place an order for checks from your new institution. Checks usually arrive within one to two weeks. Most institutions will automatically sign you up for a debit card and send it to you within a week.

3. Change direct deposits. Ask your new financial institution for your account’s routing and account numbers. If you ordered checks, they will be printed at the bottom of each check. Provide the numbers (or a voided check) to your employer or anybody else that pays you via direct deposit.

Change your direct deposit information as soon as practical because it may take a full pay period for your employer’s direct deposit change to take effect. In other words, even after you submit the changed information, your next paycheck may still go into the old account.

4. Change electronic bill paying account numbers. Once you begin to receive deposits into your new account, ensure that any billers you pay electronically have your new account information. This is especially important for any billers that automatically deduct money from your checking account.

If you pay bills electronically through your financial institution’s Web site, set up your bill information on your new account.

5. Close your old account. Once you have received your first direct deposits in your new account and have ensured all billers have your new account information, you can safely close your old account. To do this, you’ll need to write, call, or visit your old bank or credit union and ask them to close your account. When you do so, they’ll write you a check for your remaining account balance.

Warning! Do not simply withdraw all of your money and assume your account is closed. The account could remain open and incur fees for inactivity or a $0 balance.

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About David Weliver

David Weliver is the founding editor of Money Under 30. He's a cited authority on personal finance and the unique money issues we face during our first two decades as adults. He lives in Maine with his wife and two children.