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How to switch bank accounts in 3 steps

Switching bank accounts seems complicated, but it’s only a three-step process: find a new bank, reroute your automatic transactions, then close your old account.

Closing a bank account and opening a new one can be tricky.

Banks like to keep customers, so they make the closing process complicated.

The “hassle factor,” or the million-and-one little things you have to do before a task is complete, is one of the biggest reasons people don’t switch banks. Another reason is that people don’t feel like they know enough about other account options.

Breaking the process down into steps can help. Overall, it’s easier than you think. And the savings, in money or convenience, will usually be worth it.

Follow the three steps and you’ll be able to switch banks with as little stress as possible.

1. Find a new bank account first

Open the new account before closing the old one. That way your automatic transactions can continue smoothly without a gap in between.

If you haven’t already picked a new bank, do some research on different banks’ requirements, perks, and fees. Here’s what you want to look for:

  • Services the new bank offers that your old one doesn’t. These could be simple tweaks, like an easier-to-use mobile app, or major financial services like CDs and retirement accounts.
  • Interest rates. If you’re switching savings accounts, compare the interest rate you’re getting on your current account versus what you might get with a new account. Some banks offer interest-bearing checking accounts, too.
  • The convenience factor. Can you navigate the new bank’s website? How easy is it for you to find and use their ATMs? How quickly can you set up autopay or other day-to-day transactions?
  • Customer assistance options. Ideally, you’re looking for a bank or credit union that makes it easy to contact a representative if you need help, and gives you contact options you’ll actually use. If you hate talking on the phone, for instance, maybe the new bank has an email or live chat feature.

Other factors will vary from person to person, like:

  • Your future needs. If you’re hoping your new bank will give you a mortgage loan or help you set up investment accounts down the line, find a place that offers these services.
  • Your banking style. Some people love online-only banking. Others want to meet with an actual person at a brick-and-mortar branch for big transactions.
  • Your local options. Many people prefer joining a local credit union, which is customer-owned, over signing up for a national bank. Credit unions and smaller banks have other perks, too, like better interest rates on loans for members.

Another perk of switching banks is that banks will often reward new customers. This means you may be eligible for cash rewards, temporary interest rate reductions, or other bonuses when you open a new checking or savings account. See the current best checking account bonuses.

Go into the bank in person if you can, rather than opening an account over the phone (unless your bank is online). You’re more likely to get all your questions answered and you can ask directly about those potential bonus opps.

Although requirements vary depending on the bank, you’ll want to bring:

  • An official photo ID like a driver’s license, state ID, or passport.
  • Your Social Security number (you may not need your Social Security card, unless the bank specifically asks for it).
  • Cash, check, or payment info (routing and account number) for the opening deposit.

The minimum you’ll need to deposit will depend both on the bank and the type of account you’re setting up.

If you’re looking for a low minimum amount, or no fee required to open an account, your best bet is an online checking or savings.

2. List and reroute any automatic transactions from your old bank

Now that you have a new bank account, it’s time to transfer your regular deposits and withdrawals. Start as soon as possible: this part may take a while if you have a lot of automatic transactions. It’s a good chance to review which services you’re spending money on (like video streaming services or memberships you forgot you had).

Here’s where your old bank statements come in handy. Get a list of your statements from the past year. Statements should be available online at your bank’s website if you don’t have paper copies.

This is a two-step process.

Step 1: Look over the past 12 months of transactions

Some automated transactions may be annual, so you might miss them in less than a year’s worth of statements. Note when deposits show up in your account and when payments are automatically withdrawn.

Keep some cash in the old account until this step is complete. You want to avoid missing scheduled payments or getting hit with overdraft fees. If you’ve written checks recently or if payments are pending, keep the old account open and funded until those payments clear.

Step 2: Switch over your deposits and payments

Once you know which deposits and payments to transfer, you can start switching them over to your new account.

If you get direct deposit from your employer, submit your new bank info (via a canceled check or just a routing and account number).

Reroute any automatic payments to your new account as soon as you can, since the change may take a few days or weeks to finalize. Some billers require notice up to a month in advance for new payment info.

3. Close the old account for good

Read up on your bank’s procedures for closing an account first. Some banks will let you close an account by mail, online, or over the phone; some require you to show up in person.

This list collects info on how consumers successfully closed accounts at multiple American banks. But since procedures may change, your best bet is to ask the bank directly how it’s done.


Close the account in person, if possible

I recommend closing the account in person if time and convenience allow.

A bank visit makes it easier for you to get the transaction in writing. “Zombie accounts” sometimes come back from the dead — a closed account might get reactivated if you forgot to reroute an automatic payment or if there’s a billing error. To minimize the risk of a zombie account haunting you, ask for a letter from the bank stating you closed the account.

Even if you have no funds in the account, you still need to formally close it. You may be able to close an empty account online by following the instructions on the bank’s website.

Make sure you get all the money from your account

If you have funds in the account you’re closing, the bank will usually write you a check for the amount of the balance, or just transfer funds to your new account.

Your bank may require a formal written request (such as a notarized letter) to close an account with an open balance. You may also have to go to the bank in person to pick up the check. Give the money one to two business days to transfer. A wire transfer’s faster, but it costs more.

Make sure closing the account won’t affect your credit score!

If you owe money on the account you’re closing, you won’t be able to shut it down until you pay the balance and any fees.

The bank might close an account with a negative balance after a month or so, but don’t wait for this to happen — it will negatively impact your credit. You want a neat, clean closure.

When should you switch bank accounts?

You’re merging finances with a partner

In a committed relationship where you have decided to split expenses, a joint bank account can save you money and time (many people merge accounts after marriage or entering into a domestic partnership).

You might combine finances in a brand new account, or join your partner’s existing account if their bank has more of the services you need.

The fees are too high

With so many banks offering fee-free checking accounts and dropping fees from high-yield savings accounts, you don’t need to stick with a bank that piles on fees.

For example, if you keep getting hit with overdraft charges despite your best intentions, look for a bank with minimal (or zero!) overdraft fees (or one without minimum balance requirements). Similarly, if you use cash frequently, pick a bank with no ATM fees.

Another bank’s features work better for your needs


It’s normal for financial situations and priorities to change, and your banking needs might change with them.

Whether you want an account that connects to a budgeting app, offers a significantly higher interest rate over time, rewards you for better credit, works with poor credit, or lets you complete all your transactions online, there are plenty of options if your current account lacks features you need.

The bank isn’t FDIC-insured

Most banks and other financial institutions have insurance from the Federal Deposit Insurance Corporation (FDIC), which protects your money up to $250,000 in case the bank fails. (They’ll mention FDIC coverage somewhere on their website, or you can see which banks are covered here). A lack of FDIC coverage is a security red flag.

You’re relocating

If you’re moving and your current bank doesn’t have physical branches near your new location, it’s often more convenient to switch — either to a big-ticket bank with branches all over the world, a local community bank in your new area, or an online-only bank.

You don’t agree with your bank’s values

Social responsibility is a big deal to a lot of consumers, and if your bank supports a cause or makes a decision you don’t agree with, you may want to put your money where your values are.

I switched from a national to a local bank for this reason with no issues (it wasn’t even awkward when I told the teller at my former bank why I was switching).

Read more: What you should know about socially responsible banks

Pros and cons of switching bank accounts


  • Potential cost savings. Your new bank may offer a higher interest rate for a savings account, or lower fees than your old bank. After some time, you’ll start to see the savings add up.
  • Possible sign-up bonuses. You can take advantage of any one-time bonuses or financial rewards your new bank offers as a “thank you” to new customers.
  • A better fit for your needs. Maybe you finally made the switch to an all-online bank (no branch visits!) or a local bank near where you live (fewer out-of-network ATM fees!). In any case, a bank that fits your lifestyle and preferences is the best choice.


  • Transferring direct deposits and autopays. This part of changing bank accounts takes some time and energy, especially if you have lots of monthly bills on autopay.
  • Less familiarity. You know less about the new bank’s procedures, and they know less about you — like your credit history, for instance. This means the approval process might take longer if you want a loan or additional account at your new bank.
  • Finding fees in the fine print. Banks and credit unions should be upfront about any fees they charge. But when you open a new account or close an old one, you’re getting a lot of information at once. Info on fees could be easy to miss if you’re not looking out for it.

The bottom line

Closing your bank account and opening a new one can be a pain, but if you take the right steps and make sure you do everything correctly, it doesn’t have to be a huge hassle.

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