Five questions to ask when choosing a bank

Most of us don’t have time to do a full-scale research project when looking for a bank, and it can feel overwhelming knowing where to begin. Here are five key considerations for choosing where to bank.

1. Do they have accounts that meet your needs?

The type of bank account that you open should vary based on how you plan to use the account. For instance, are you looking for an everyday current account, a flexible savings account, or a longer-term investment? Different banks will offer different services, so it’s good to have an idea of what you’re looking for.

Once you’ve established whether you’re looking for a current account, savings account, or something else, you should consider how accessible you need the funds to be. For example, if you’re wanting to open a savings account, but think you may need easy access to your money in case of emergency, then you’d be best looking for a savings account with a short notice period. Alternatively, if you’re looking to save for a longer period, you may be better looking at a fixed-term investment like a savings bond, which will often mean you also get a higher interest rate.

It’s also worth looking at any fees and costs, as some banks will charge for account maintenance, overdrafts, and early withdrawals.

2. Where do they invest your money?

Once you’ve chosen the account type you need, it’s important to look at where the bank will invest your money. This is often referred to as ‘ethical banking’ and is a growing conversation, as people want to know how their money is being used.

“When you deposit money into your current account or savings account, it doesn’t just pile up in a big vault somewhere. The bank makes a profit by investing your money in businesses, for example, or by giving loans to individuals or charities. When you choose a bank specifically on its ethics, you’re having a say in what your money helps to fund.” – Money Saving Expert

This will vary from person-to-person, but it’s good to think about your personal views. Are there things you would feel uncomfortable funding? Often people will look particularly at areas of social responsibility, avoidance of exploitative practice, and environmental impact. This can also have implications for those with religious beliefs. It’s important to do some digging and see how your money will be used by the bank.

3. Is your money safe?

There are lots of banking regulations which are in place to protect your funds. It’s good to check that your bank is part of relevant schemes that provide you with peace of mind. For instance, are they part of the Financial Services Compensation Scheme (FSCS)? The FSCS automatically protects your money (up to £85,000) if your bank or building society were to go out of business.

Safeguards and regulations like this are very important in ensuring your money is protected and secure. Look for banks who are transparent with regulators and up to date on their reporting, as this is a good indicator of how responsible they are.

4. What are your non-negotiables?

It’s worth thinking through what your non-negotiables are when it comes to your bank. Are physical branches important to you? Is digital banking or a banking app something you can’t live without? Do you want the most competitive interest rates? Once you’ve worked out your list of requirements, you can then be more precise in your search for a bank which provides these services.

There may be things that you’d like but that aren’t a deal-breaker. If this is the case, it’s good to work out whether there are some aspects of banking which you’d be willing to compromise on if other areas are in place. For instance, some people like Hugh and Deanne will be more willing to compromise on getting the most competitive interest rates if they are sure their money is being invested ethically (see point two!)

5. Is their customer service good?

In a digital age an increasing frustration for many is the rapid decline of customer service. It’s worth looking at the responsiveness and reactions of the banks you are considering. If you have a question or an issue, can you speak to a real person and not a robot? If you have a complaint, how quickly will they work to resolve it? How often will you receive statements or information about your account? Good customer service makes such a difference to your experience with your bank and can go a long way in giving you the confidence that you’ve put your money in the right place.

At Kingdom Bank we have three core values that influence all we do; glorifying God, putting others first, and being committed to quality. This means when our customers ring with a question they will speak to a real person, who will do all they can to ensure they have a great customer experience. As a Christian bank we are clear where your money is being invested – providing mortgages for churches, charities, and ministry workers. If your spending and giving is driven by faith, shouldn’t your banking be as well? To see our range of accounts, click here!

Kingdom Bank does not provide financial advice. Please seek independent financial advice as required when structuring your finances.

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