The short answer: move if your current bank charges fees you don't use, pays almost no interest, or makes saving harder through inconvenient access
You don't have to stay with your first bank. If the savings account you opened isn't working for you — because it costs money to maintain, because the interest rate is so low it barely counts, or because the bank makes it too straightforward to spend the money you're trying to save — switching to a different bank is a normal thing to do. Many people have accounts at more than one bank for different purposes.
The decision comes down to three things: what you're paying in fees, what you're earning in interest, and whether the account actually helps you save. This guide walks you through how to think about each one and what to do if you decide to switch.
Key Takeaways
- Monthly maintenance fees, overdraft fees, and minimum balance requirements can cost you money every month — switching to a bank without these fees is often worth the effort.
- Interest rates on savings accounts vary widely between banks, and moving to a bank that pays more interest means your money grows faster without you adding anything.
- If your current bank's app or website makes it too straightforward to transfer money to checking and spend it, a separate bank with a different login can create a useful barrier.
- Opening a new account takes 10 to 20 minutes online, and you don't have to close your old account right away — you can test the new one first.
- Moving your money is straightforward: you can transfer it yourself, or give the new bank your old account details and they can pull it for you.
When fees at your current bank are costing you money
Some banks charge a monthly fee just to keep a savings account open. Others charge a fee if your balance drops below a certain amount, or if you make more than a certain number of withdrawals in a month. These fees come out of your account automatically, which means they're eating into the money you're trying to save.
Before you decide to switch, look at your last three months of statements and add up what you've paid in fees. If you're paying $5 or more per month in maintenance fees, overdraft fees, or other charges, the cost of switching is worth it. Online banks and credit unions often have no monthly fee at all, which means every dollar you deposit stays yours.
Check your account agreement or call the bank to confirm what fees explore. The fee schedule is usually on the bank's website under "Savings Account" or "Account Fees." If you're not sure whether you're being charged, ask — the bank has to tell you.
When interest rates are so low your money barely grows
A savings account interest rate is the percentage of your balance that the bank pays you each year just for keeping money there. If your bank pays 0.01% interest and another bank pays 4.5%, the difference is huge. On $1,000, that's the difference between earning 10 cents a year and earning $45 a year.
Interest rates change based on what the Federal Reserve does with its own rates, so the rate you see today might be different in six months. But at any given moment, banks offer very different rates. You can compare current rates on websites like Bankrate or DepositAccounts, which list what different banks are paying right now.
If your current bank's rate is more than 1% lower than what other banks are offering, switching will put real money in your pocket over time. A higher rate means your savings grow faster without you having to add more money yourself.
When straightforward access to your money makes it hard to save
Savings accounts are supposed to be separate from checking accounts so you're not tempted to spend the money. But if your savings account is at the same bank as your checking account, and you can transfer money between them with one tap on your phone, the separation is mostly mental.
Some people find it helpful to keep their savings at a completely different bank — one where they don't have a checking account, and where they'd have to log in separately and wait a day or two for a transfer. That small friction makes it less likely you'll raid your savings for something that isn't actually an emergency.
This is a personal choice. If you're good at not touching your savings, it doesn't matter where the account is. But if you know yourself and know you'll spend it if it's too straightforward to reach, a separate bank creates a useful barrier.
How to move your money without losing track of it
Opening a new savings account at a different bank takes about 10 to 20 minutes online. You'll need your Social Security number, a government ID, your current address, and your employment information. The bank will ask a few questions to verify who you are, and then you'll have an account number and login information.
You don't have to move all your money at once, and you don't have to close your old account right away. Many people open the new account, move a small amount over, and use it for a month or two to make sure they like it. Once you're sure, you can transfer the rest.
To move money, you have two options. You can log into your old bank and transfer money out to your new account — you'll need the new account number and routing number. Or you can give the new bank your old account details, and they'll pull the money for you. Both ways are safe and take one to three business days.
What to do with your old account after you switch
You don't have to close your old savings account when ready. Some people keep it open for a few months while they get used to the new bank, just in case they need to go back. Once you're confident the new account is working for you, you can close the old one by calling the bank or doing it through their website.
Before you close it, make sure there's no money left in it and that you've moved any automatic deposits or transfers. If you had a debit card linked to the old account, that will stop working once you close it. Check your records to see if anything was set to deposit into that account — your paycheck, a government benefit, a transfer from someone else — and update it to go to your new account instead.
Closing an account won't hurt your credit score. Your credit is based on borrowing and repayment, not on which accounts you keep open.
When staying with your current bank makes sense
If your current bank charges no fees, pays a competitive interest rate, and you're comfortable with how it works, there's no reason to switch. Moving accounts takes time and attention, and if nothing is broken, the effort isn't worth it.
You might also want to stay if you have other accounts at the same bank and moving would split your money across multiple places in a way that's harder to manage. Some people prefer having everything in one place, even if another bank would pay slightly more interest. That's a valid choice — the best account is the one you'll actually use and stick with.
Frequently Asked Questions
Will switching banks hurt my credit score?
No. Opening a new savings account and closing an old one have no effect on your credit score. Credit scores are based on borrowing money and paying it back, not on which banks you use or how many accounts you have.
What if I'm not sure which bank to switch to?
Start by comparing interest rates and fees on websites like Bankrate, DepositAccounts, or NerdWallet. Look for banks with no monthly fees, no minimum balance requirements, and interest rates above 4% (rates change, so check current offers). Read a few reviews on Google or Trustpilot to see what customers say about customer service and how straightforward the app is to use.
Can I keep money at both banks at the same time?
Yes. Many people have savings accounts at multiple banks. You might keep a small amount at your original bank and move most of your savings to a new one, or split your money between two banks for different reasons. There's no rule against it.
How long does it take to transfer money between banks?
Most transfers between banks take one to three business days. Weekends and holidays don't count as business days, so a transfer you start on Friday might not show up until Tuesday. If you need money quickly, plan ahead.
What if I forget to update my direct deposit to the new account?
Your paycheck or benefit payment will go to your old account instead of your new one. You can still transfer it over, but it will take a few extra days. Contact your employer or the organization sending the payment and give them your new account number and routing number. They'll update it for the next payment.