card guide
Opening and Closing Bank Accounts

Come fly with me

Banks promise the world in their advertising, but sometimes opening an account can be a lot harder than it seems. Sometimes closing an account can be equally as difficult. Does it all just boil down to how much money you can give the bank?

Start at the beginning

Opening a current account is usually a straightforward process if you are employed. Look around, don’t opt for the first bank you see, look at what the market place has to offer and sit down with all the promotional literature to compare one with another. Look at the interest rates, the bank charges, do they offer overdrafts, if so, how much? Decide how you are going to use that bank account, what do you expect from it and therefore what are you looking for and does anything that you have seen match that criteria?

If you have already had a bank account then you will know the sort of things to expect. For an absolute beginner it can seem a confusion of choice. But just as with anything else as long as you know what you are looking for you can decide which product (bank account) suits you best. And if, a few months later, you find you have made the wrong choice, no harm’s done: change it.

Mean Business

Whatever type of bank account you are going to open you will be required to take with you some form of identification, such as a passport, a driving licence or even a utility bill. If you are opening a business account you will need those, plus a business plan.

A business plan, no matter how ‘guestimated’, should demonstrate to the bank manager how you see your business in terms of cash flow and profit. Initially it will probably only be for the first 12 months or so and should obviously indicate a healthy business proposition.

If you are new to business and are starting out as a sole trader, you should consider whether or not you need to open a business account. Most banks will accept sole traders as account holders of personal accounts. From your point of view this is quite useful as the charges are considerably lower. You may, however, want the professionalism of a company account if you are to be operating in a business name.

Closing an account

When it comes to closing your account it will depend on how well you have managed that account and in what circumstances you are closing it. Are you choosing to close it or is the bank ‘forcing’ you to?

If the bank is suggesting you close the account because you are not really using it, then unless you really want to keep it open you may as well go along with their wish.

If you are closing it after a period of successful use, which in the eyes of the bank, would be profitable use, then you may find there are several things you need to do before walking away. The bank will also want to know why you are leaving! This may involve filling in some forms, so be warned.

Clearly, what you must do before you close you account is to either cancel or change all your standing orders and direct debits, so it is always best if you are changing banks to have set up your new account well in advance of closing the old one.

Swings and roundabouts

Banks are in business to make money. If they can see you as a potentially profitable customer when you apply for a bank account they are likely to want your custom. Likewise if you have paid them a lot of money, usually in charges, then they are more likely to want you to stay with them.

After all, money does indeed make the world go round, or so the advertisers tell us.

Come fly with me

Banks promise the world in their advertising, but sometimes opening an account can be a lot harder than it seems. Sometimes closing an account can be equally as difficult. Does it all just boil down to how much money you can give the bank?

Start at the beginning

Opening a current account is usually a straightforward process if you are employed. Look around, don’t opt for the first bank you see, look at what the market place has to offer and sit down with all the promotional literature to compare one with another. Look at the interest rates, the bank charges, do they offer overdrafts, if so, how much? Decide how you are going to use that bank account, what do you expect from it and therefore what are you looking for and does anything that you have seen match that criteria?

If you have already had a bank account then you will know the sort of things to expect. For an absolute beginner it can seem a confusion of choice. But just as with anything else as long as you know what you are looking for you can decide which product (bank account) suits you best. And if, a few months later, you find you have made the wrong choice, no harm’s done: change it.

Mean Business

Whatever type of bank account you are going to open you will be required to take with you some form of identification, such as a passport, a driving licence or even a utility bill. If you are opening a business account you will need those, plus a business plan.

A business plan, no matter how ‘guestimated’, should demonstrate to the bank manager how you see your business in terms of cash flow and profit. Initially it will probably only be for the first 12 months or so and should obviously indicate a healthy business proposition.

If you are new to business and are starting out as a sole trader, you should consider whether or not you need to open a business account. Most banks will accept sole traders as account holders of personal accounts. From your point of view this is quite useful as the charges are considerably lower. You may, however, want the professionalism of a company account if you are to be operating in a business name.

Closing an account

When it comes to closing your account it will depend on how well you have managed that account and in what circumstances you are closing it. Are you choosing to close it or is the bank ‘forcing’ you to?

If the bank is suggesting you close the account because you are not really using it, then unless you really want to keep it open you may as well go along with their wish.

If you are closing it after a period of successful use, which in the eyes of the bank, would be profitable use, then you may find there are several things you need to do before walking away. The bank will also want to know why you are leaving! This may involve filling in some forms, so be warned.

Clearly, what you must do before you close you account is to either cancel or change all your standing orders and direct debits, so it is always best if you are changing banks to have set up your new account well in advance of closing the old one.

Swings and roundabouts

Banks are in business to make money. If they can see you as a potentially profitable customer when you apply for a bank account they are likely to want your custom. Likewise if you have paid them a lot of money, usually in charges, then they are more likely to want you to stay with them.

After all, money does indeed make the world go round, or so the advertisers tell us.

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Posted on: [ November 03, 2017 ]       Add to Del.icio.us   Digg it   Add to Blinklist   Add to FUrl   StumbleUpon