How to Switch Bank Accounts (Without the Hassle) and Earn a Fat Signup Bonus

Last updated 12/31/2024 by

Edited by

Summary:

Switching banks can feel like a hassle, but it doesn’t have to be. Many people stick with their accounts for years, even decades, because they believe switching is too difficult—and banks count on this. However, new banks are often willing to reward you generously for switching. Here’s how to make the process simple and take advantage of better perks.

On average, Americans keep the same bank account for over 17 years, largely due to the perceived hassle of switching. Banks are well aware of this inertia, which is why they rarely offer perks to loyal customers. Meanwhile, competitors often lure new customers with attractive signup bonuses, reduced fees, or higher interest rates.

The average checking account has a monthly fee of $10, but there are great checking accounts that either don’t charge a fee or allow you to waive it if you meet certain requirements. So, not spending an hour on opening a new account may be costing you $120 a year plus whatever signup bonus you’re missing out on (more on signup bonuses later). Switching accounts can be an easy way to save money while earning some cash—here’s how to do it in five simple steps.

How to Switch Bank Accounts Checklist

Switching banks doesn’t have to be difficult. Follow these five steps to make the process seamless and take advantage of new perks.

Define your priorities: Decide what’s important in a new bank, like lower fees, better customer service, higher interest rates, or signup bonuses.
Open your new account: Gather your ID, Social Security number, contact info, and an initial deposit to set up your new account.
Get your new routing and account numbers: Use your new bank’s routing and account numbers to update all automatic payments and direct deposits.
Transition from your old account: Keep your old account open for at least one billing cycle to ensure all payments are successfully transferred.
Close your old account: Withdraw remaining funds and officially close the account after confirming all payments have cleared.

Compare Business Checking Accounts

Compare checking accounts. Discover your best option.

Compare Options

Step 1: Define what you want in your next bank

Start by identifying why you’re leaving your current bank. Maybe it’s excessive fees, bad customer service, low interest rates, or limited features. Knowing what you want helps you choose a bank that better suits your needs.

Ask yourself:

What fees will I incur, and are they lower than my current bank’s fees?
Do they offer features like mobile check deposit, automated bill pay, or a user-friendly app?
Are the savings account interest rates competitive?
Do they offer a physical branch nearby or just online services?
What signup bonuses or perks are they offering for new customers?

Once you have your priorities clear, you can research banks that match your criteria. Look for competitive offers like high-yield savings accounts or signup bonuses for opening a checking account.

Step 2: Open your new account

After finding a bank that meets your needs, the next step is opening an account. Many banks allow you to do this online in just a few minutes. Here’s what you’ll need:

Identification (driver’s license, passport, or state ID)
Social Security number
Contact details (address, email, phone number)
Initial deposit (use funds from your current account but leave enough to cover pending payments)

Be sure to review the account terms and conditions to understand fees, minimum balance requirements, and how to qualify for signup bonuses.

Step 3: Transfer automatic payments and deposits

One of the trickiest parts of switching banks is updating your linked accounts. Use this checklist to ensure a smooth transition:

Identify automatic payments (utilities, subscriptions, insurance, etc.) from your old account and update them with your new account information.
Transfer direct deposits from your employer or government benefits by providing your new account and routing numbers.
Update digital payment platforms like PayPal, Venmo, or Apple Pay with your new account details.
Set up recurring transfers between your new checking and savings accounts.

Pro Tip: Keep your old account open until all payments and deposits have successfully migrated.

Step 4: Transition out of your old account

Don’t close your old account immediately. Leaving it open for one billing cycle ensures that any overlooked payments or deposits are accounted for. During this transition period:

Stop using your old debit card or checks at least two weeks before closing the account.
Monitor your old account for unexpected transactions.
Confirm all automatic payments are successfully debited from your new account.

This step helps you avoid fees or complications from missed payments or deposits.

Step 5: Close your old account

Once everything has cleared, it’s time to close your old account. Contact your old bank to confirm any required documentation and bring a valid ID. Before you close, withdraw any remaining funds or transfer them to your new account. Keep in mind some banks charge a small fee for account closure, especially if you only opened it recently.

Take advantage of bank signup bonuses

Many banks offer signup bonuses to attract new customers, such as cash rewards for opening an account or meeting deposit requirements. These offers can offset the pain of switching and provide a financial boost.

Key takeaways

Banks count on customer inertia, which is why switching can unlock better perks and lower fees.
Researching and opening a new account is straightforward, especially with online options.
Updating automatic payments and deposits is the most time-consuming step but can be tackled with a clear checklist.
Leaving your old account open during the transition ensures no payments are missed.
Many banks offer generous signup bonuses, making the switch financially rewarding.

View Article Sources

Show Article Sources

Share this post:

Table of Contents