Closing more bank accounts
I’ve mentioned that I’m purging many of my bank accounts in hopes of leading a less cluttered financial life. Here’s the current status:
- Bank of America checking
- Bank of America money market savings (a higher yield savings)
- ING Direct savings
- MCTFCU savings
- An old credit union savings from my hometown
- Old checking account at my wife’s hometown bank
- HSBC Direct savings
Bank of America savingsCitibank savingsEmigrant Direct savings
I’ve killed the Citibank and Emigrant Direct accounts already, and next in line were HSBC and my old Bank of America savings account.
Bank of America
The BoA account was only earning 0.2% APY! At least my BoA MMA is earning almost 3% (more on this later)! Also, it required a $300 minimum, which I could be earning more interest on elsewhere. So this morning I called up and closed this 6-year-old savings account with no problems. I got the $311 balance transfered to the MMA and canceled the Keep the Change program. I don’t use my debit card much, so I really don’t much money from KtC.
HSBC Direct
As for HSBC Direct, I couldn’t close it until the account was empty of funds. Similar to Emigrant Direct, HSBC Direct wouldn’t just send me a check or transfer the money for me. I have to transfer out all the money first before requesting that they close it. I should expect about a 3-5 day turnaround for the money transfer to complete, based on experience, and then I can send a “BankMail” through their online interface to close it.
Even More Account Closures?
So going from 10 checking/savings accounts down to 6 will be very nice, but I’d like to reduce even more. I mentioned that my BoA MMA account is only getting 2.94% right now (it was 4.5% when I opened it). One of the reasons I’m closing accounts that have higher yields than the ones I am keeping is because I don’t want to play the rate-chasing game anymore. But I’ll move most of the money from our BoA MMA to ING Direct and just keep it there. Bank of America is known for being stingy, and the main reason I opened the account is to have a better savings account at the same bank as our checking. But a half-percent difference in yield is worth the one last money move. I may even end up closing the BoA MMA too.
As for the credit union accounts, I’m keeping the MCTFCU one open so I can more easily get a loan if needed (I’m not a volunteer teacher anymore). I’m seriously considering closing the one in my hometown because I just haven’t used it for so long and it only has $10 in it. I can get better loan and savings rates online or closer to our home here, so no reason to keep it. The same thinking goes for Stacie’s old checking account from her younger days. We left it open thinking her parents might need to use it, but that’s just silly. I’d rather just close it so we don’t someday forget it’s there and lose that money.
So I may end up dropping another 3 accounts to bring the total down to just 3 open accounts total (1 checking, 1 savings, and 1 credit union). Wouldn’t that be nice? 🙂
I like what you’re doing. I can’t imagine having so many different personal accounts. I can see keeping different business acounts separate and whatnot, but that’s a lot of accounts.
I understand! We’re working on consolidating our accounts too. My old one was only getting the same 0.2% and I’m linking the new one to ING. Much better rate even though it dropped.
I really need to do this myself as I’ve left accounts open with nominal amounts in old banks, credit unions, etc.
I think you’re being wise closing these accounts. I have always closed accounts when I stopped using them. One thing to keep in mind is that unless there is activity within a certain period, the account will automatically be closed and the money will escheat to the state. So not only is important to not forget about them (as you pointed out), but to DO something with them once in a while.
I think simplifying your accounts is the way to go. I have two banks and that’s enough to keep me busy.
I really need to do it too. Starting with Citybank which I only opened to get free $100 – I like free money. Probably HSBC too since FNBO where I have my main saving now has slightly higher rate.
Quick question. How do you close Citybank direct? What about HSBC? Do they have an option when you transfer all money out or do you need to call/write them? I’ve only started using internet banking not that long ago.
kitty: For Citibank, you just call them and request that they close the account. They sent me a check of the balance.
For HSBC, you have to transfer your money out first, then you either mail, fax or “Bankmail” the request to close the account to them. Bankmail is probably the easiest. It’s the bottom left option on the left once you login. Just make sure the money has been moved out before sending the notice so they don’t complain that they can’t do it. I’m waiting for my money to move out right now.
I’m relieved that I’ve reduced my accounts too. i had signed up for all the promo accounts this past year, and although no issue tracking them all, it felt taxing having so many accounts opened.
Clever Dude – thanks.