Big banks have been a pain in the backsides of many Americans lately; the number of fees they use to bleed folks dry has been all over the news (Bank of America ringing any bells?) Well, local credit unions have taken notice and decided to use this as a way to pull in customers.
Today is "Bank Transfer Day", where thousands upon thousands will move their accounts from major banks to local credit unions. It's a way to let fat cats in the banking industry know that people are tired of their greed and have other options. The push came when Bank of America, among others, announced that it would soon charge debit card holders a monthly fee for using said debit card. After a huge uproar, the bank dropped the debit card fee plan, but it was too late. The damage has already been done and organizers began planning "Bank Transfer Day".
Now, like many others, I bank with one of the major banks and have bills that get paid straight from my account, so moving my money and opening an account elsewhere is a task. This is by no means something that can be done quickly. Luckily, Josh Harkinson, over at Mother Jones, has a list of suggestions for those who want to leave the big banks, and their numerous fees, behind:
Why would I want to move my money out of my existing bank?
You'll probably save money in the long run. According to a 2009 year study by the Filene Research Institute, the average credit union account holder paid $71.47 in annual fees, compared to $183.14 paid by the typical bank customer. And new restrictions on debit card fees imposed last month by the Dodd-Frank Act have sent banks scrambling for even more ways to nickel and dime their customers in pursuit of profits. Nonprofit credit unions, on the other hand, only need to break even. They also tend to plow their money back into basic loans in their own communities, instead of dabbling in the kind of complex and risky securitized investments that caused large banks to go bust and drag down the economy. It's important to note that credit unions and small local banks aren't recession-proof: a striking 17 percent of Florida's bank failures since 2008 were community banks.
What's the process?
Don’t expect to be able to open a credit union account and close your old bank account in one day. You'll need to receive new checks and a debit card in the mail, switch over any automated deposits and electronic bill paying services, and wait for pending financial transactions to clear. Only then should you give your old bank the boot. Here's a searchable map that locates credit unions near you.
How long does it take?
You'll probably need to wait one or two weeks to get a debit card and checks in the mail, though some credit unions will issue you temporary versions. Besides that, it's just a matter of finding the time to switch over your bills.
Aren't credit unions less convenient than big banks?
Not necessarily. While individual credit unions typically have fewer branches than corporate banks, many participate in "shared branching," allowing customers to make a deposit or withdrawal at other participating credit unions. Also, many credit unions have implemented advanced online banking options including direct deposit, online bill-pay, and mobile banking using your cell phone.
(Source: Mother Jones)
I suggest you take a look at what else Harkinson had to say regarding the way to move your account from a big bank to a credit union. Lots of food for thought. I'll also note that if you are happy with your bank, then of course there is no reason to move your account elsewhere. However, for those of us who are tired of banks tacking on new and greedy fees, this might be what you're looking for. Make sure you put a lot of thought into it before making a decision.