Changing your bank is easy
OPINION: Banking relationships last longer in many cases than marriages, which is curious because switching bank is a lot easier than getting a divorce.
My theory, based on my own experience and that of friends and acquaintances, is that people move bank either because they become furious at poor service, or because they are chasing a better mortgage rate, or because of a major life event like a marriage.
Patriotic fervour may drive some to switch bank, judging by the rise of Kiwibank, but I have always ascribed its rise and rise to the sharpness of its interest rates and low fees.
There may even be instances where people see a new account or service advertised or a better savings interest rate, which sparks a decision to up sticks for fresher banking pastures.
The truth is many of us inherit our first bank from our parents, a kind of arranged marriage which begins when they take us along as wee children to open our first account.
After that, we bumble along and too often think that what "our" bank is offering is pretty standard, when we could be doing much better elsewhere.
And then one of those jolts mentioned above can get us thinking about moving.
But nowadays when people decide it is time to switch bank, they find it is a lot easier than it used to be.
A few years back Kiwibank lobbied for banks to get together to create a simple system to allow for greater ease of switching.
Under threat of legislation, all the banks agreed. That's great because easy bank switching makes for greater competition in banking services, which is a national good and has driven a better deal even for people who have chosen not to switch to cheaper banks.
Nowadays all you have to do to switch bank is give the bank you want to go to the authority to contact your old bank to get all your banking details.
Once you have chosen the accounts and services you need at your new bank, it will open them for you, switch over all your automatic payments and issue you with the cards you need.
It'll even make sure your old bank accounts are shut.
The whole thing takes about two weeks.
It shouldn't hurt at all.
Of course, if you have got a mortgage, simply storming out of a bank branch in fury and giving your authority to switch to a new bank isn't so easy. If your mortgage is floating, then you'll be able to shift with help from your new bank, which you should expect to pay all the costs of your moving to them.
But, if all or part of your loan is fixed, it will be much harder, and you'll need some advice from the bank you want to go to. You'll need to be patient, as the process - depending on what fixed-rate terms you have chosen - may take a while and there could be a cost in breaking the deal.
Many readers might find themselves feeling disloyal in considering moving bank.
Banks feel no loyalty to us, and there is precious little value attached to a long-term banking relationship other than the power it gives banks to charge us fees and interest for longer.
DON'T . . . Worry about the feelings of your bank manager. He doesn't worry about yours.
Put up with bad service and high fees.
Think changing banks is hard.
Stop looking around for a better deal.