Published in: Banks | Sept. 4, 2019
It's Time to Upgrade Your Bank Account. Here's Why
By: Lyle Daly
You could be costing yourself money by staying with the same bank.
If you’re like the average American, then one of your longest relationships is probably with your bank.
It sounds crazy, but people stick with the same bank account for over a decade, on average. After all, once you’ve found a place to park your cash, why would you want to go to the trouble of changing?
Here’s why -- you could end up with more cash in your account by making a switch. To explain how, let’s look at the three reasons you may be missing out on more money if you don’t upgrade your bank account.
1. A higher interest rate
There’s a huge difference between the average savings account interest rate and the interest you can earn with one of the best savings accounts. After months of procrastination, I recently switched to a new savings account, and I’m earning over 2% more interest than before.
I realize that the interest rate you earn from a savings account will never be that exciting or life changing. At the same time, it’s always good to get as much value from your money as possible. If you had the opportunity to earn 1% or 2% more from your investments, you’d probably take it, so it makes sense to do the same with your bank account.
Due to how safe savings accounts are, they’re the natural choice for certain types of savings, such as your emergency fund and money you’re putting away for any big purchases you have planned within the next five to 10 years. Considering you’ll need a savings account anyway, you might as well maximize your interest.
2. No fees
There’s no reason you should be paying any fees to your bank. Unfortunately, plenty of consumers end up paying account maintenance fees or ATM fees. These often go ignored because they don’t cost you that much individually, but they’ll add up over time if you’re paying them regularly.
You’ll see these types of fees most often with checking accounts, and if you’ve been paying them, then it’s worth your time to make a change. You can find plenty of excellent checking accounts that have no monthly maintenance fees and either offer plenty of ATMs for you to use or will reimburse you for any ATM fees that you incur.
3. A sign-up bonus
Banks want your business. It’s a competitive marketplace, and if you’re not a client already, then they want you to open bank accounts and credit cards with them. One way they’ll try to entice you to do this is with sign-up bonuses.
All you need to do is open an account that has a sign-up bonus and complete the terms of the offer. There are plenty of bank account bonuses available, and requirements may include depositing a certain amount of money, receiving enough direct deposits, or making a minimum number of debit card transactions.
If you can meet the requirements and the bank account has all the features you want, then a sign-up bonus is the perfect way to get some extra cash out of the deal.
Maximizing value with your bank account
I know firsthand how tempting it is to maintain the status quo with your bank account.
However, it’s easier than ever to make a change. With many banks, you can open a new account online in less than 10 minutes. It’s well worth your time to look at:
- How much more you could earn in interest
- The fees you could avoid
- Sign-up bonus opportunities
A quick change could help you both earn and save more money on your banking.
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