Should You Switch Banks in 2023?

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KEY POINTS

  • Loyalty doesn't earn you much in finance. Changing banks can be rewarding.
  • Savings account interest rates are climbing in some places, but stagnant in others.
  • Time changes all things. If your bank -- or your life -- has changed a lot, it may be time to find a better fit.

Start off your year with a fresh financial start.

Compared to the last couple years, 2022 has gone by in a blink. Believe it or not, we're just a few months shy of finding ourselves in 2023.

Along with the rest of the financial world, the banking landscape has changed noticeably this year. Many of our personal finance needs and realities have also evolved.

With so much change in the air, it raises the question: should you consider changing your bank in 2023? Here are a few things to consider when pondering your answer.

Banks tend to reward new customers

One of the sad facts of the world is that loyalty is rarely rewarded these days. Instead, it's new customers that get all the deals. We see it with everything from deals for switching cell phone carriers to credit card sign-up bonuses.

And we see it with banks.

Many banks offer new account bonuses. You can find them for all types of bank accounts, including checking and savings accounts. There are even bonuses for small business owners who open a new business checking account.

As with credit card bonuses, new bank account bonuses do have a few requirements to earn. Most commonly, banks will require you to meet a minimum deposit amount, and to maintain that amount for a set period of time. For example, you may need to deposit at least $2,500 and maintain the balance for 90 days to earn the bonus.

Some bonuses may want you to have a minimum number of direct deposits over time. And checking accounts also tend to require that you make a certain number of debit card transactions within the first 90 days.

Be sure to read the fine print on your bonus to make sure you can meet the criteria before opening an account. Of course, you should also make sure the bank actually meets your needs, too. New account bonuses are nice, but if you're looking for a new bank, it should be one you can feel comfortable doing business with in the long term.

A new bank could mean better rates

We've seen a lot of interest rate hikes by the Fed this year. This is bad news for those carrying debt, but it could be good news for anyone with a savings account.

That is, if you have the right savings account. We've seen a lot of banks raising savings account interest rates lately; you can now find savings accounts with APYs in the 2% to 3% range. This was nearly unheard of just last year.

But it's not every bank that offers these interest rates. In fact, it's become comically easy to predict which banks will increase savings APYs, and which won't. It's a matter of footprint.

Most of the best savings account interest rates can be found at online-only banks. These are banks that don't have brick-and-mortar branches. Instead, they operate entirely online, through web browsers and mobile apps.

While online-only banks aren't for everyone -- some folks like having that person-to-person interaction -- they can be ideal for anyone who hasn't stepped foot in a physical bank branch since the launch of the smartphone.

There may be a better fit

As with anything else in life, your bank has probably changed over the years. Banks merge and split, account and features update, and costs and savings increase (or decrease).

For example, what once were free checking accounts now tend to have fees. And there's the big switch to digital banking. If your bank hasn't kept up with technological evolution, is it still meeting your needs?

Even if your bank is more or less the same, you -- and your financial needs -- have certainly changed over the years.

Do you have a small business now and want your business accounts to be at the same place as your personal ones? Has your family grown, and now you need to save for college? The smaller, local bank of your youth may not be the right fit for your expanded needs as an adult.

It's a vastly different world than it was just a few years ago, and you may have vastly different goals. If you've never taken the time to consider if your bank is still the right fit for your financial needs, 2023 may be the time.

These savings accounts are FDIC insured and could earn you 11x your bank

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts could earn you 11x the national average savings account rate. Click here to uncover the best-in-class accounts that landed a spot on our short list of the best savings accounts for 2024.

Two of our top online savings account picks:

Rates as of Apr 18, 2024 Ratings Methodology
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SoFi Checking and Savings Western Alliance Bank High-Yield Savings Premier
Member FDIC. Member FDIC.
Rating image, 4.75 out of 5 stars.
4.75/5 Circle with letter I in it. Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor. We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best
= Excellent
= Good
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Rating image, 4.50 out of 5 stars.
4.50/5 Circle with letter I in it. Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor. We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best
= Excellent
= Good
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APY: up to 4.60%

APY: 5.36%

Min. to earn APY: $0

Min. to earn APY: $0.01

Our Research Expert

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