Switching Banks Made Easy | Everything You Need to Know

Switching banks or financial institutions might seem complicated, but modern tools for transferring money like electronic transfers (ACH transfers), wire transfers and online banking make it much simpler than you might think. Whether you’re moving funds from one account to another or closing out your old account, this guide will help you quickly navigate the process.

How to Switch Financial Institutions: The key to a smooth transition

Switching financial institutions is more common than ever, especially as people seek better customer service, lower fees, or higher interest rates. Moving your money, switching automatic payments, and notifying employers or other financial parties can feel overwhelming, but following these steps will make the transition seamless.

1. Open a new account at your chosen credit union or bank

Before closing your account, ensure you have a new one ready. Most financial institutions, including Arizona Financial Credit Union, offer the convenience of opening accounts online or in person. To complete the process, you’ll need personal information like your Social Security number, ID, and proof of address.

2. List all your automatic payments and deposits

Compile a list of your automatic payments (utilities, streaming services, insurance) and direct deposits (paychecks, retirement benefits). Switching banks means you’ll need to update these details with your new bank’s information, such as your account number and sort code.

This is where ACH transfers come in handy. ACH transfers are bank debit transfers that allow payments to automatically move from one bank to another electronically without needing physical checks.

3. Transfer funds from the old account to the new account

When it’s time to move your money, you can do so through various types of bank transfers:

ACH transfers: Perfect for those who want to move funds electronically between accounts. These transfers are usually free, secure, and completed within a few business days.

Bank wire (wire transfers): For a more immediate transfer, wire transfers allow you to send money quickly, often within the same day. These may involve fees but are an excellent option for large sums or time-sensitive transactions.

Bank credit transfers: These transfers move funds from your account directly into another person’s bank account. This is often used for bill payments, making it an easy option if you need to send money directly to another party.

Your old bank may also offer an in-branch service to facilitate this transfer, but mobile and online banking tools typically streamline the process.

4. Set up your new automatic payments and deposits

Once your funds are safely in your new account, it’s time to set up those automatic transfers. Whether it’s utilities, mortgage payments, or depositing your paycheck, you must provide your account holder’s name, account number, sort code, payment amount, and payment date.

Most companies and employers offer a straightforward process to update this information through their online systems. Double-check that everything is set up correctly to avoid missed payments.

5. Monitor your old account for any outstanding payments

Even after transferring your funds, leaving your old account open for a month or two is a good idea. This gives you time to ensure all automatic payments have been switched over successfully and that no pending transactions are unresolved. You can close the old account once you know everything is in order.

What you'll need for bank transfers

You'll need some critical information, no matter which type of bank transfer you’re making. Having these details handy ensures a smooth and quick transaction:

• Account holder’s name: This is listed on the receiving or sending account.
• Account number and sort code: These details identify the account and bank branch you're transferring to.
• Amount to pay: The exact amount being transferred.
• Payment date: When you want the transaction to occur. This is particularly important for recurring ACH transfers or scheduled transfers via online banking.

How bank transfers work: ACH, wire transfers & more

Several methods exist for transferring money between accounts or from one financial institution to another. Understanding how they work will help you choose the right one for your needs.

ACH transfers

ACH transfers are the backbone of many bank transfers today. Electronic transfers are processed through the Automated Clearing House (ACH) network. You can use ACH transfers for:

• Direct deposits: Like your paycheck or government benefits.
• Bill payments: Automatically pay your rent, utilities, and other recurring charges.
• Transferring funds between your accounts: Moving money between a checking and savings account or between two different banks.

ACH transfers are typically free, though some banks might charge a small fee for outgoing transfers. They usually take 1-3 business days to process.

Bank wire transfers

Wire transfers are ideal for sending large amounts of money quickly. Wire transfer moves funds directly between financial institutions, often on the same day. This type of transfer is commonly used for:

• Large purchases: Such as buying a house or making significant investments.
• Sending money abroad: Especially if you need to transfer funds across borders.

Wire transfers tend to be more expensive than ACH transfers, with fees that vary by bank, but they offer the security and speed many people need for high-value or urgent transactions.

Bank credit transfers

When you make a bank credit transfer, you transfer money directly from one account to another. This might include paying a utility company or sending money to a friend. Credit transfers can be done via online banking, mobile apps, or in person at a branch, giving you the flexibility to choose the most convenient option.

How to make a bank transfer

Regardless of the type of bank transfer, the process is relatively straightforward. Here’s a step-by-step guide to help you through it:

1. Log in to online or mobile banking: Use your bank’s secure online portal or mobile app to start your transfer. You can also make transfers via phone or in-branch if needed.
2. Select the transfer option: Depending on your bank, look for options like “Transfer Money” or “Move Funds.”
3. Enter the recipient’s details: including the account holder’s name, account number, and bank sort code.
4. Specify the amount and payment date: Confirm how much money you want to send and when you want it to be sent.
5. Review and submit: Double-check the details to ensure everything is correct before confirming the transaction.

Conclusion

Bank transfers, whether through ACH, wire transfers, or credit transfers, are integral to managing your finances. Knowing what you’ll need and how to complete these transactions gives you confidence as you switch banks, send money, or manage payments.

Whether transferring funds to or from Arizona Financial Credit Union, the process is designed to be simple, secure, and efficient, giving you peace of mind at every step.