Some people change their cell phones every couple of years and others get a new car every few years. But when it comes to checking accounts, people set it up and consider themselves finished. Recent research from Fiserv showed that the average person keeps his or her checking account for 10 years. But failing to upgrade a decade-old checking or savings account means you may be missing out on the latest and greatest your financial institution has to offer.
"We encourage people to evaluate whether their checking accounts are keeping up with their lifestyles," said Beverly Ladley, client strategy and solutions executive at SunTrust bank in a prepared statement. "On average, people keep checking accounts years longer than cell phone, jobs or cars. As life’s circumstances change, however, people should consider upgrading their checking accounts as well."
Here’s how to tell if it’s time to upgrade your checking account.
You’ve reached a milestone
Life events such as getting married, a new child, or move, for example, are often a good time to review how well your checking account is working you. Most banks offer a variety of accounts intended to meet customers’ needs at different stages of their financial lives. These will typically include a range of benefits, plus ways to offset a monthly fee.
"Customers should consider their level of financial activity and determine if they would benefit from features such as preferred rates on loans on deposits, discounts on banking services or breaks on ATM fees," says Lane Dunn, manager of product strategy at First Citizens Bank. "You may need a simple transactional account or one that supports more complex financial needs. A good relationship banker will help you identify the best for your life stage."
If you’re a young professional but your account is still "student" checking, you’ve likely outgrown your account, says Steven Hughes, founder and chief financial mentor for Know Money, a financial literacy organization.
Location is everything. If you moved and there are no bank branches near you, consider switching. "I’ve seen people use a checking account from the federal credit union or local bank from their hometown, but are no longer located there and have to do everything online or over the phone," says Hughes.
Your money would be better served elsewhere
Another sign – when balances start to increase monthly without little to no debits. "This is a tell tale sign that you don’t need a checking account for what it offers. You would do best in a savings account or another investment vehicle," says Tai McNeely, co-founder and editor of the HisandHerMoney blog.
You haven’t talked to a banker since opening your account
"People don’t talk to their banker so they don’t realize that if have multiple accounts, or have higher balances or credit cards with the bank that may entitle them to receive free or discounted perks, such as free cashier’s check, free personal checks, discounted loan rates, and higher interest rates on savings accounts, just to name a few," says McNeely.
Being clueless about your financial institution’s latest offerings can be costly. Financial institutions continue to roll out enhancements that can save you money, time and help you manage your money. "If you check your account and still have to do math to figure out how much you spend, it’s time to consider a new checking account," says Lauren Berg, a spokeswoman for Simple, which offers online and mobile banking. "Current balance doesn’t tell the whole story and you shouldn’t have to get out a calculator just to figure out if you can afford to buy that new pair of shoes or splurge on a last minute vacation."
Simple’s Safe-to-Spend, she says, is a more relevant version of your available balance. "It does all the math for you by taking your balance and subtracting upcoming bill payments, pending transaction, and goals you’re saving for. With Safe-to-Spend, you get a more accurate picture of what you can really spend today without hurting yourself tomorrow," says Berg.
SunTrust has a new lineup of checking packages designed with lifestyle in mind. For example, the Essential Package includes an Essential Checking account with simple ways to waive the monthly maintenance fee, including 10 or more monthly transactions; and no monthly maintenance fee for five years for students. Whereas, the Signature Advantage Package includes a Signature Advantage Checking account (and up to four additional Essential Checking accounts with no monthly maintenance fee); unlimited non-SunTrust ATM transaction fee refunds, an option to participate in Delta SkyMiles Debit Card program, a small safe deposit box with no annual fee, and an introductory promotional money market account interest rate.
Simply put, there’s a lot going on. Know what’s happening. Andrew Bosserman a certified public account says he recently completed a 5-month trip through Asia and was able to withdraw local currency in each country fee-free using a Charles Schwab High-Yield Investor Checking Account. "The account has no fees whatsoever and no minimum balance requirements," says Bosserman.
How did he find such a gem? "I was reading travel blogs. This was recommended by many world travelers. Just using Google to search for a checking account with the features you want such as ‘fee-free checking account with remote deposit’ will help you find what you want," says Bosserman.
The bottom line says Lane, "Understand that the checking account is the anchor for your primary banking relationship."