The Average American Has Been With the Same Bank for 14 Years. Now Is a Good Time to Shop Around

Photo to accompany story about bankrate survey. Twenty20
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A lot has changed since 2007.

We’ve seen countless technological advances, four presidential elections, two recessions, and a global pandemic over the past 14 years, for starters. 

Yet the average American still banks with the same financial institution as they did 14 years ago, according to a recent study from Bankrate.

That’s in line with the most recent data from J.D. Power, too. The consumer insights firm found that just 4% of consumers switched banks in the past year in its 2019 Retail Banking Satisfaction Study

“When things are comfortable, consumers tend to accept things for what they are,” says Vincent Ciccarelli, vice president of online banking at Bryn Mawr Trust. “They have no real driving force to go out and look at what other services are out there, even though there’s a good chance that they can improve the efficiency of their day-to-day in some form.”

But shopping around for new account options can lead to lasting savings and a better banking experience, with benefits like lower fees, increased interest earnings, and more convenient tools and banking services.  

Getting Comfortable

Convenience can be a big reason to stick with one bank for the long-haul — if your checking or savings activities aren’t regular sources of frustration, and you already have direct deposits or auto-debits set up, making a change can seem like more trouble than it’s worth.

This can be especially true for customers of big, national bank brands with hundreds of branch locations and easy online access. “The convenience is so overwhelming compared to others, a lot of people find that it’s hard to change,” says Ken Tumin of, a site that tracks deposit account interest rates. 

Pro Tip

Look for bank accounts that align with your specific needs — no minimums or direct deposit requirements, great online tools, etc. — to find the best fit.

Then there’s the more human, less tangible reasons you might stay with a bank, especially when it comes to credit unions and local or regional banks. Many people enjoy the community aspect, says Sidney Divine, a certified financial planner (CFP) and founder of Divine Wealth Strategies in Atlanta. If your local credit union does great service or outreach in your neighborhood, you might not explore other options because you want to support them as a customer. Or maybe you’re friendly with your local bank branch’s tellers, and value their conversation and great service every time you visit the branch. 

With these conveniences, you may be more willing to overlook a bad customer service experience or lack of online banking tools. But there’s one factor that remains a major sticking point for banking customers, even when they’re otherwise satisfied: fees. 

The Cost of Fees

If you’re paying any monthly fee for your checking or savings activity, it might be time to explore other options, especially since 72% of Americans report paying no monthly fees according to the Bankrate survey. (Like NextAdvisor, Bankrate is owned by Red Ventures.)

The monthly average cost for checking account fees (including routine service charges, ATM, and overdraft fees) is $7.65. That may not seem like much, but over the course of a year, that’s equal to $91.80.

Americans Facing Financial Stressors Most Likely to Pay 

And in recent months, the people who need those extra dollars the most are the ones paying the highest price, experts say. 

“Those whose personal finances have been adversely affected by the pandemic have been hit with a double whammy of higher banking fees,” says Mark Hamrick, senior economic analyst at Bankrate. 

Households which suffered a financial setback related to the pandemic pay a monthly average $11.41 for checking account costs, while those who say their finances haven’t been negatively affected financially pay just $2.79 per month on average, the Bankrate data shows. 

When you experience a financial setback, your account balances are likely to decrease, as you withdraw the money in your account. Job and income loss also often means a loss of regular direct deposits coming in, which often can trigger maintenance fees you might not have realized apply. 

Those can be two primary reasons for increased fees among those most vulnerable, according to Tumin, because keeping your balance above a monthly minimum threshold and taking in direct deposits are two of the most common ways to waive bank fees. And as your balances get lower, you take on the additional risk of overdrafting your account, taking on costly overdraft fees, he adds.

How to Take Action

When it comes to making a change, nothing spurs action like being hit with big fees, Tumin says. 

If you find monthly fees reducing the funds in your account on a regular basis, figure out why. Are you unable to meet a minimum account balance? Do you need to set up spending and balance notifications to help you avoid overdrafting? Know your own financial habits and use that knowledge to mitigate your risk. 

Apply your everyday use to your bank’s fee structure. If you’re someone who is cash-reliant and often goes to the ATM, you should know exactly how much you’re being charged each time you withdraw from an ATM, for example. That’s a great way to make sure you’re mitigating general fees on a daily basis, Ciccarelli says.

Once you’ve determined how you’re affected by fees, taking action may not mean closing your account altogether. Often, you can eliminate certain fees by learning the specifics of your account’s policies and working with your current bank on ways you can eliminate the fees or get them waived. But looking at other financial institutions can be helpful if you find your current checking or savings account just doesn’t fit with your needs.

How to Decide If a Banking Change Makes Sense

Fees are a large part of many people’s decision to open a new account or make the switch to a new financial institution, but they’re not the only one. Here are a few other details you should consider:

Online Banking Developments

The pandemic has changed a lot about our daily lives, including how we bank. In fact, the majority of Americans (64%) with checking accounts report adjusting their payment practices as a direct result of the pandemic, according to Bankrate’s survey, including 45% who say they’ve paid bills online more often and 25% who have made more deposits with a smartphone app.

“Even before the pandemic, we had seen an enormous shift to digital reliance,” Ciccarelli says.
“Technology and digital services allow consumers to improve efficiency day-to-day.” He points to a few specific things that can help give you an idea of how well a bank is keeping up with the latest digital innovations. 

First, what actions are you able to make using mobile or online tools? “Not every financial institution is up to speed on technology, and now more than ever, being able to deposit checks remotely is a hugely important part of everyday banking,” Ciccarelli says.

You may also want to explore integrated financial tools — especially if they allow you to aggregate all your financial information in one place, even accounts from other banks — and fraud prevention and resolution. 

“Once we’ve emerged from the pandemic and the economic downturn, it will still be wise to take advantage of newer mobile banking technologies not only to save time, but to help stay on top of account balances and fees as well as the potential for potentially costly overdrafts and fraud,” Hamrick says. 

Branches and Service

Customer service plays a huge part in our satisfaction with financial institutions — it’s one of the primary factors of J.D. Power’s satisfaction rankings, and a bank’s ability to resolve issues in a timely manner can have long-lasting effects on how we perceive its reputation.

When you’re weighing your banking options, knowing how you prefer to interact with your bank can be useful.

“If you’re the type of person who relies on a live person, a customer care center environment or retail banking and you want to speak to people to help you with transactions, look for institutions that have retail banking locations and a customer service division whose hours meet your day to day,” Ciccarelli says. 

On the other hand, if you don’t usually go into a branch and are comfortable relying on electronic conflict resolution and customer service interactions, you’ll want to make sure your institution has a solid messaging system or other way to work with representatives directly online or via mobile app.

Interest Rates and Rewards

Over the past several years, high-yield savings accounts promising low fees and high interest rates have become more popular, thanks to the proliferation of online-only banks (and online divisions of larger banks). With fewer overhead costs than traditional financial institutions, those banks are able to pass on their savings to account holders as higher-yield accounts. 

As recently as 2019, interest rates on deposit accounts offered yields of 2% or more on savings. In today’s near-zero rate environment though, savings interest rates aren’t quite so competitive (though at around 0.5%-0.7%, they are still 10x the national average of 0.05% that most big legacy banks offer).

If you already have a high-yield account, shopping around is unlikely to do you any favors; at that point, you’re wasting time with $3 questions, rather than asking the $30,000 questions you should be, as financial expert and New York Times bestselling author Ramit Sethi recently told us in an Instagram Live interview.

But if you’re not earning more than the national average on your savings, or you’re already considering a new checking or savings account, rates can make a big difference, especially once interest rates eventually begin to climb again. 

Another perk, according to Tumin, is account features designed to help you save, such as automatic transfers between banks and round-ups on each purchase that go directly to savings. New banking options like online-only banks might be worthwhile to consider for these features, especially if your goal is to commit to a better savings habit and build up an emergency savings account, he says.  

Bottom Line

Making the switch to a new bank account can be tedious. And if you’re satisfied with where you’re at, there’s nothing wrong with keeping the same account for 14 years, or even longer.

“There are plenty of customers who are very content where they’re at,” Ciccarelli says. “When they sit down and evaluate what they need from a financial institution, they’re checking off all the marks.”

Even if that’s true, it’s worth evaluating your satisfaction regularly, to find any service gaps that might be missing in your experience or fees you might not be aware of.

“If you self-evaluate and you find that your institution meets your needs in terms of fees, customer service, digital services, and strong community presence and growth, that’s perfectly fine,” Ciccarelli says. “But it’s always a good idea to take a moment and go through a bit of an evaluation.”