Switching banks (again)

My banking setup is rather complicated. Right now, I have 8 active bank accounts and 2 credit cards with 6 different banks. None of these banks charge me any fees for any of my accounts, so I’ve always just left them open as I’ve switched banks. My primary bank used to be ASB, then it was National, then KiwiBank, then ANZ. I am now currently in the process of switching back to KiwiBank.

For the past year or so with ANZ, I’ve had a more complicated system than in the past. I had a current account, savings account and a credit card with them. I switched to them because their credit card got me the maximal amount of Air New Zealand Airpoints, and it seemed easier to have my main account with them too.

My workflow has been as follows:

1. Salary gets paid into my ANZ current account.
2. There are two immediate deductions: rent and a transfer to my long term savings at RaboDirect (it used to be several different transfers into several special purpose RaboDirect savings accounts, but I’ve since consolidated).
3. Everything except about $300 is then transferred to my ANZ savings.
4. All purchases go on my credit card.
5. When my credit card is due, it is automatically paid in full from the ANZ current account.
6. Just before the credit card payment is due, I transfer enough money from savings to current to cover it.

I thought having a savings account with ANZ would be smart because the money would be instantly accessible, unlike the savings in RaboDirect, and I would earn interest on it during the month, unlike my current account. And this has proved to be true – I think it has earned around $24 in interest over the year. But that is offset by the 2 $10 dishonour fees I was charged when I forgot to set up the transfer in time. I just don’t think earning a few bucks a year is worth the extra hassle of having that account and having to transfer money back and forth all the time. Still, that’s only a reason to close my savings account, not a reason to switch banks altogether.

I’ve never particularly liked ANZ’s internet banking interface very much – it’s mostly functional, but it’s clunky and I certainly don’t enjoy using it. That’s not really enough of a reason to switch banks either. The catalyst that caused me to switch is actually something quite small. I sold something on Trademe for $20 and the person who bought it paid the money into my bank account over the counter. That counts as a manual transaction and so the bank charged me $3. I just can’t believe that it costs me $3 for someone else to deposit $20 in my account. I anticipate more of this kind of deposit in the future, since I’m ultimately selling almost everything I own over the next few months before I leave.

So I decided to switch back to KiwiBank, which has always been my favourite. I love that they don’t charge for deposits. I love their banking interface – everything is just well thought out and nicely designed. I love the fact that they aren’t doing everything they can to squeeze a few more dollars of profit for some overseas owners. I love the fact that the staff at the local branch actually suggest things that are best for me and not best for the bank. I love the fact that when I went into the bank to ask for an ATM card, they issued it to me on the spot instead of having to post it out to me. I love the fact that I applied for an equivalent credit card to the one I currently have with ANZ online two nights ago, and the card was in my mailbox this morning!

The reason why I left them for ANZ was the slightly higher Airpoints earning rate on their credit card. But that’s relatively moot now that I’m actually struggling to even use the Airpoints I have. AirNZ don’t fly to India and so they just aren’t as useful for me anymore. Once I’ve spent them, I will probably get rid of my Airpoints credit card and just forget about them.

I’ve already switched all of my automatic payments & bank account direct debits & credits over from ANZ to KiwiBank. I just need to transfer two credit card direct debits and I’ll be able to say goodbye to ANZ. I’d keep the account open and empty because when it comes to mortgages, during tight times, it is helpful to have an existing relationship with a bank. However, they have an inactivity fee they charge on unused accounts, so I’ll be closing it. Since National don’t have an inactivity fee, I’ll probably leave that account open even though I don’t use it.

So, my new banking portfolio will look like this:

• KiwiBank (primary current account, credit card, flat account & business account)
• RaboDirect (primary savings account, plus 3 inactive special purpose savings accounts)
• ASB (investment account, $5 balance, seldom used)
• National Bank (current account, zero balance, unused)
• Bank of Baroda (savings account, $500 balance, only used for transfers to India)