Years ago, some folks used to keep their savings in a mattress at home. If you had enough money to consider a bank, you went to your local one. There was rarely competition in an area.
Times have changed. Accessibility to banks is possible both by location and through the Internet. Financial institutions compete for your business by offering different rates, minimums to open accounts, hours, online availability and gifts to open accounts (sometimes even money!). While almost every bank offers debit cards and use of 24-hour ATMs, fees can vary.
If the bank you've been using no longer meets your needs, or an issue was not resolved to your satisfaction, you might be looking for a change. While this is not necessarily a bad thing, if you are considering making a bank change you need to look at more than just what the bank can offer.
Wherever you decide to go, trust is a very big consideration. You work hard for your money, and ideally you should have your money working hard for you. You have to trust that you will get the things that are promised; that your bank will be there down the road.
Generally, bigger banks are in business to make money and do so by charging customers. Credit unions are owned by their members, so profits go back to the investors/customers. Larger institutions offer 24-hour customer service by phone, but if you are looking for more personalized service where you know your banker face to face, a smaller bank may be more to your liking. If the bank you've been using merges or has a name change, speak to a bank officer to find what changes it may mean for you in terms of fees and policies.
Before you go changing your bank, make sure that you know exactly what your needs are. Do you require personal and/or business checking, savings for a small amount or large deposits, mortgages, student loans, car financing or other services, such as investment counseling, term life insurance and debit/credit cards? Do you travel a lot? Are you comfortable with online access and paperless statements? Finding a bank that seems custom-catered to your lifestyle is tantamount to making a decision.
Travelers need to be able to access their banks services without too many problems, so branches and ATMs should be readily accessible. Be sure that ATM fees are not prohibitive. While credit unions are normally restricted to a specific region, many belong to a cooperative network where you can access your accounts through another credit union if you are away from home.
Many banks offer no-fee online statements, but if you are not comfortable using the Internet, this may not be the best option for you. Paying your bills online will make your account more accessible from anywhere, but again you need to feel comfortable using this feature.
The results of a recent independent survey with input from BankRate.com, Credit Union National Association and MoneyRates.com support the theory that no one banking solution is right for everyone. This study revealed advantages and disadvantages for mega-banks, smaller institutions and credit unions alike.
Bigger banks fared well for ATM access, branch networks and loan options. Smaller banks and credit unions offered lower minimums for free banking, personalized customer service and profit-sharing. Most bank and credit union deposits are federally insured to $250,000, so your money is safe with any option.
Before you decide to make a switch from your current institution, make a full list of what else you might need to change. Do you have penalties if your withdraw money from savings accounts? Are your employment check or dividends direct deposited? Do you have automatic payments set up for your utilities, insurance, mortgage or other payments?
If you leave your current bank, will your mortgage or loan rates rise? This is not to imply that it's too much of a hassle to change banks; these are just some of the things you need to consider when looking at the option.
Choose a bank you feel comfortable with and one that best fits your needs as they relate to your financial goals and requirements.