I know I just told you why it is such a good idea to keep every account at one bank. It is convenient and can save you money. However, it might not really be that great of an idea.
While it is nice to have instant transfers and keep everything at one place, it is not always a good idea to keep everything at one place. You are not always in control of your accounts if you make a mistake.
In my time as a banker, I once had a customer that screwed up really bad. She didn’t make her credit card payment for months, she didn’t answer our calls, she didn’t answer her mail, and she ignored us. She owed a few thousand dollars on her card and we didn’t want to have to write it all off.
As one of those types of people who probably does not read what she signs, she probably did not notice that we had the right to take money from her checking or savings account to pay delinquent bills that she owed us. So we did.
She did not have a lot of money in her account, so on direct deposit day our credit department made a catch up payment on her behalf. All of a sudden, she had time to call us back.
If you have bad customer service from your credit card company, it is easy enough to move your account. If you have a bad experience at your bank, you only have one account there, so it is not that big of a deal.
If everything is at one bank, you are stuck. If you have bad service or an irreconcilable problem, you don’t have any recourse. You can always try a manager or try for a ‘good customer’ refund or discount, but you can’t really control anything.
Now that you have seen both the benefits of having everything at one bank and the drawbacks, what do you think? How do you have your accounts? What have your experiences been like? Please share in the comments.
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10 thoughts on “Why You Should Not Keep Everything at One Bank”
As I get old(er), I want to simplify things. I have always kept my banking simple because I have been treated well at my bank. I also have a savings account at my credit union (30+ years).
Do you have external investment accounts at other institutions as well?
These are some smart tips. Diversifying your funds is extremely important. Who knows what could happen? Better to mix it up than be sorry.
Thanks for the comment Jon. How do you keep your accounts? How many banks?
I like diversificiation, even at the level of bank accounts. There’s a balance to be had with simplification, but I generally think it’s good to apply the principle of not putting all of one’s eggs in one basket.
That makes sense. You never know when your bank will pull a Lehman Bros and shut down. I once had a bank close (I only had a CD there) and luckily got a check in about two weeks. If I had my checking there, however, that two weeks would have been tough.
Although it can be very confusing, it is important to understand and
know how bank rates amongst its competition. Bank Ratings are not
difficult to find, and they are easy to understand. Yes we need to Diversify our funds.
When you say ratings, do you mean customer service or interest rates? I think it is nice to follow good customer service even if the rate is slightly lower. However, a major difference in rates could make it worth moving a large balance.
I prefer the diversified strategy… but I still make sure I have it set up so it’s easy to manage 🙂
How many different banks do you use?
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