Yes, you can switch banks, and the process is straightforward if you plan it in steps
You can move your bank account to another bank at any time. There is no penalty for leaving, no waiting period, and no permission needed from your current bank. The main work is telling the right people about your new account number so payments keep flowing without interruption. If you move without planning, direct deposits might bounce, automatic bill payments could fail, and you could miss money coming in.
The actual switch takes a few days to a few weeks depending on how many automatic payments and deposits you have set up. Most of the time is spent waiting for your old bank to send information to your new one, not on paperwork or decisions you make.
Key Takeaways
- Open your new account before closing the old one, and keep both open for at least two weeks while you redirect payments.
- You must manually update your account number with your employer, creditors, and any service that sends you money or takes payments from you.
- Your old bank cannot hold your money hostage or charge you for closing, though some banks charge a fee if you close within a short window.
- If a direct deposit or bill payment fails because you switched, contact the sender to resubmit with your new account number rather than waiting for them to notice.
Open your new account first, then update payments one at a time
Start by opening an account at the new bank while your old account is still active. You need the new account number before you can tell anyone where to send money. Once you have it, make a list of every place that touches your account: your employer (payroll), your landlord or mortgage servicer, any loan servicers, credit card companies, utilities, subscriptions, and insurance companies.
Contact each one and provide your new account number. This is the step most people skip or delay, and it is the one that causes problems. A direct deposit that goes to the wrong account sits in limbo for days while your old bank tries to figure out what to do with it. A bill payment that fails because the account is closed gets returned, and you may be charged a fee by both banks.
Start with your payroll and any income you receive regularly. Then move to bills you pay automatically. Leave subscriptions and one-time vendors for last, since a missed payment there is usually less urgent than a missed mortgage or paycheck.
Keep your old account open for at least two weeks
Do not close your old account the day you open the new one. Keep it open for at least two weeks, longer if you have many automatic payments. During this window, money may still arrive at the old account if someone has not yet updated your information, and you need to be able to see it and move it.
Some payments take time to process. A bill payment you set up at your old bank might not leave the account for several days. If you close the account before that payment clears, it will bounce and you will be charged an overdraft or returned-item fee by your old bank, and possibly a late fee by the creditor.
After two weeks, check your old account one more time to make sure no deposits or payments are still pending. Then you can close it. Most banks let you close an account online or by phone, and they will not ask you to come in.
What to do if a payment fails after you switch
If a direct deposit bounces or a bill payment fails because you gave the wrong account number or the sender did not update their records, do not assume the problem will fix itself. Contact the sender immediately with your new account number and ask them to resubmit the payment.
For payroll, call your HR or payroll department and confirm they have your new account number in their system. Ask them to resubmit the deposit if it failed. For bills, log into your account with the creditor and update the payment method, or call them directly. Do not wait for them to notice the error.
If your old bank charged you a fee for a returned payment, you can ask them to reverse it, especially if it was their first time processing a payment to a closed account. Some banks will do this as a courtesy; others will not. It is worth asking.
Closing fees and what banks can and cannot do
Your bank cannot charge you a penalty for leaving or switching to another bank. However, some banks charge a fee if you close an account within a certain window—often 90 days to six months of opening it. This fee is for closing the account early, not for switching banks, and it applies whether you move your money or not.
Check your account agreement or call your bank before opening a new account elsewhere to see if there is a closing fee. If there is, you can decide whether it is worth paying to switch now or waiting until the window closes. Some banks will waive the fee if you ask, especially if you have been a customer for a long time.
Your old bank must give you access to your money while the account is open. They cannot freeze it or delay a withdrawal because you told them you are switching. If they do, that is a violation of banking rules and you can file a complaint with your state banking regulator or the Consumer Financial Protection Bureau.
Moving money from your old account to your new one
You have several ways to move your balance. The simplest is to transfer money online if both banks are connected through a service like ACH (Automated Clearing House). Log into your new bank's website, look for "transfer" or "move money," and follow the prompts to link your old account. The transfer usually takes one to three business days.
If the banks are not connected, you can write a check to yourself from your old account and deposit it into your new one. You can also withdraw cash and deposit it, though this is slower and less secure. Some banks offer a service called a "bank-to-bank transfer" or "external transfer" that lets you move money without writing a check.
Do not close your old account until the transfer clears and you see the money in your new account. If something goes wrong, you need the old account to still be active so you can investigate.
If your new bank asks for a direct deposit to waive fees
Many banks offer lower fees or higher interest rates if you set up a direct deposit. If you are switching banks partly to get this benefit, make sure your employer can actually set it up before you commit. Some employers can only deposit to one account at a time, so you may have to wait until your next paycheck cycle to switch.
Ask your HR department how long it takes for a new direct deposit to start. Most employers process changes within one pay period, but some take longer. Plan your switch around your payroll schedule so you do not miss a deposit.
Frequently Asked Questions
Can I keep my old account open after I switch banks?
Yes. You can keep both accounts open indefinitely if you want. Some people keep an old account open as a backup or to receive payments from a source they forget to update. Just be aware that if you keep it open, you may be charged monthly maintenance fees. Check your account agreement to see what fees apply if the account is inactive.
What if I forget to update my account number somewhere and a payment fails?
Contact the sender as soon as you notice and give them your new account number. Ask them to resubmit the payment. If it was a bill payment, call the creditor and explain what happened so they do not report you as late. If it was a deposit, ask your employer or the sender to resubmit it to your new account.
Do I need to update my account number with my bank's customer service line?
No. Your bank does not need to know where you are moving your money. You only need to tell the people and companies that send you money or take payments from you. Your bank will close the account when you ask them to, regardless of whether you have updated everyone else.
Can my old bank refuse to close my account?
No. You can close a bank account at any time for any reason. Your bank cannot force you to keep the account open or charge you a penalty for closing it (except for the early-closure fee mentioned above, which some banks charge). If your bank refuses to close your account, contact your state banking regulator.
How long does it take to fully switch banks?
The account opening takes a few minutes online or in person. Transferring your balance takes one to three business days. Updating all your automatic payments can take anywhere from a few days to a few weeks, depending on how many you have and how quickly each company processes the change. Plan for at least two weeks total before closing your old account.