Moving Your Money? Use these tips to do it right!
By Consumers Union on Thursday, April 22nd, 2010
Back in December The Huffington Post asked people to take a pledge to move their money from the big banks who took billions in bailouts, to smaller local community banks and credit unions. As the post explained:
The idea is simple: If enough people who have money in one of the Big Six banks… move it into smaller, more local, more traditional community banks, then collectively we, the people, will have taken a big step toward re-rigging the financial system so it becomes again the productive, stable engine for growth it’s meant to be.
But moving your money can be a big hassle and a risky one at that. Nowadays many consumers pay their bills online, have their checking accounts linked here and there, have automatic deposits and payments coming and going all the time and it can seem like a daunting task to safety move everything somewhere new. It’s like losing your wallet and having to cancel all your cards, but even more complicated!
To help you move your money safety and easily, we’ve put together this checklist so you can take the appropriate steps and ensure that all of your bills are paid on time and you avoid being charged overdraft fees. If you follow the instructions and stay organized you can quickly move your financial business to a new institution. Print the checklist here.
Step 1. Open your new bank account with a small deposit.
Step 2. Make a list of all the automatic payments and deposits that are scheduled to go in and out of your old account each month.
Step 3. If you have direct deposit, ask your employer to reroute your paychecks to your new account. Ask what date the first deposit will occur and use this date to guide you through Step 4.
Step 4. Once you know what date your direct deposits will transfer, reschedule each automatic payment or debit to come out of your new account. Make sure to ask the company what date the change will apply.
Step 5. Leave at least a small amount of cash in your old checking account for at least one more month.
Step 6. Once you are sure that all automatic payments and all direct deposits are coming and going from your new account, electronically transfer the final funds from your old account into the new account.
Step 7. Once the transfer clears in your new account, follow the procedures for closing an account at your old financial institution. Make sure to obtain written confirmation that your account is closed.