credit & debt

How to Break Up With Your Bank

Five steps to help you leave your current bank and start over somewhere else

You’re ready to move on. But you may have signed up for direct deposits and scheduled automatic withdrawals. That makes switching banks more complicated. Take these steps to help make the transition smooth and painless.

To start, open your new account. You’ll need the account number and the bank routing number to transfer automated transactions.

Make a list of your direct deposits and automatic withdrawals. These could include paychecks, Social Security and pension checks, and monthly payments from a mutual fund. Don’t forget to include accounts, such as Treasury Direct, that deposit funds periodically. Contact each provider to find out what you need to do to transfer the payment and how long it will take for the change to take effect. Then go through the same process for all your automatic withdrawals, making sure no debits occur before your direct deposits take effect.

Print out records. If you bank online, download and print any important transactions—checks to the IRS, for example, or your final mortgage or student-loan payment. Download and save your e-statements.

Consider outstanding loans. If you’re getting a discount on your car loan or mortgage because you have multiple accounts at your current bank, see if your new bank will match it.

Close your old account. Once you’re certain all checks have cleared—you may want to wait a couple of weeks to be sure—you’re ready to pull the plug. You may cancel your account at a bank branch, by mail or over the phone, and you can ask the bank for cash or to cut you a check. Be sure to get a letter confirming that the account has been closed.

Most Popular

Your Guide to Roth Conversions
Special Report
Tax Breaks

Your Guide to Roth Conversions

A Kiplinger Special Report
February 25, 2021
The Berkshire Hathaway Portfolio: All 41 Warren Buffett Stocks Ranked
stocks

The Berkshire Hathaway Portfolio: All 41 Warren Buffett Stocks Ranked

The Berkshire Hathaway portfolio is a diverse set of blue chips, and increasingly, lesser-known growth bets. Here's a look at every stock picked by Wa…
November 16, 2021
The Case Against Owning All Dividend-Paying Stocks in Retirement
investing

The Case Against Owning All Dividend-Paying Stocks in Retirement

Income investors are often all about dividends, but that may not be a smart strategy for retirees. Here’s why, and what investment model they should c…
November 8, 2021

Recommended

How to Choose the Right Payment App
banking

How to Choose the Right Payment App

Using PayPal, Venmo, Zelle and other apps is convenient, but there are pros and cons to each.
November 23, 2021
What to Do If Your Credit Card Is Closed
Making Your Money Last

What to Do If Your Credit Card Is Closed

The issuer may restore your account with the previous terms, or it may request that you reapply for the card.
November 22, 2021
Don't Let Your Credit Card Rewards Expire
Travel

Don't Let Your Credit Card Rewards Expire

If your miles or points are expiring too soon, see if you can reset the clock by transferring some to another loyalty program.
October 28, 2021
Should I Use Credit or Debit?
Basics

Should I Use Credit or Debit?

Credit cards offer more protections and rewards, but debit cards reduce the temptation to overspend.
October 4, 2021