How to choose a bank in Canada - The Dime Turner

Official blog of Refresh Financial

What To Consider When Choosing A Bank


Wondering how to choose a bank? If you’re here because you’re working towards a better credit score, getting out of debt and saving money, chances are you’re looking a little bit more critically at the financial institutions you use. Maybe you’ve noticed you’re paying a lot in service fees, or maybe there isn’t a good high-interest savings account available to you. Whatever the case, changing financial institutions really isn’t that hard, and choosing the right one can make turning your financial situation around that much easier.

Here is what to consider when thinking about how to choose a bank:

1. What are their fees?

It may take a translator and a magnifying glass to discover all the hidden fees, but you have to do it. Doing your homework here is going to save you some disappointing surprises later. Find out what the monthly fees are and what the extra service fees are. Do you have to pay to use an in-the-flesh teller? Do you have to pay a fee to use online banking or telephone support? What are the fees for using bank machines, whether they are your bank’s machines or the machines of other institutions? These fees may sound small one at a time, but they build up quickly and can easily eat into the money you were saving. Find yourself an institution with limited fees and save your money instead.

2. What is the highest interest rate you can get on a savings account?

The institution you choose should offer a high-interest savings account that doesn’t require a minimum balance. Make sure the interest rate is good enough to justify choosing that bank, especially if the account has fees. If it costs more to use your bank than you earn in interest, you’re losing money on the whole deal.

3. Does your bank have physical locations?

Some institutions that offer high-interest savings accounts only offer over-the-phone or online banking, and that can get tedious real fast. If you ever use human tellers now, you’ll likely use them in the future, and perhaps a bank without a physical location isn’t the best option for you.

4. What is their customer service track record?

When I switched banks, one in particular stood out when I did my research. The comments were almost all praise in reviews online and when I spoke to other customers, they raved about the service. This absolutely helped me make my choice, because a place with great customer service is going to be more likely to take an interest in your financial goals.

5. How were you treated by staff when asking a few questions?

I’ve seen people head into a major bank and be turned away for a secured line of credit, only to be welcomed with open arms at a credit union. The way they treat you now is a good indication of how you will be treated in the future. Find a bank or credit union that takes an interest in you and your money. You have no idea how helpful this will be going forward.

6. Is their online banking fairly robust or bare bones?

Banks that offer feature-packed online banking systems, as well as easy to use apps for your smartphone, are going to be infinitely easier to deal with. Features like being able to deposit your cheques with a photo save you a tonne of time and are worth considering when changing banks.

7. What is the bank’s security track record like?

Your money is only as secure as your bank is, so make sure that where you keep your dough is as strong as Fort Knox.

Some of these considerations are going to be more important to you than others and considering them will slowly reveal which institution is the best for you. Everyone is different, so don’t just take someone else’s recommendation. Really look closely at all the pros and cons - choosing the wrong bank can become a major pain in the you-know-what really quickly.

What are some of the most important things you consider when looking for a bank? Let us know in the comments!

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