Best tips for closing or switching a bank account in Spain or the UK

Closing a bank account isn’t as easy as just withdrawing all the money in a given account and completely blanking out the balances because if you don’t go directly to the bank and have them close it, it may accrue commissions.

But don’t worry there may be a few options to close down the account without having to cover any final costs.

So, make sure you have taken into consideration all the possible commissions they may charge you such as maintenance fees, administrative fees, money transfer commissions or charges for usage of related items such as your debit and credit cards.

There are examples of bank account holders that pay an average of 170 euros a year in commissions. The costs of a bank account can be greater if your salary isn’t paid directly into your account, for instance.

If you’re opening up an account or are closing one and thinking about starting up another, make sure you analyse your options and find an alternative that doesn´t charge commissions based on minimum monthly balances or deposits.

Photo: Andrevruas

Here are some steps to consider when you decide to close an account:

  1. Make sure there are no strings attached to closing your account early. The reason we say this is because some banks offer gifts when you open an account with them. Well, these gifts are not free as they are usually linked to a clause in the contract penalising early withdrawals or closing of the product. Sometimes, minimum balances or other products that require certain permanency. So make sure you watch for all terms and conditions. It doesn’t hurt to ask all the pertinent questions such as commissions on withdrawals at ATMs, payments at stores and online, among others.
  2. Make sure you keep all your receipts and statements in one safe place, including the document that is proof of cancellation of the account. It’s a monumental task but it is holding on to all proof of transactions during the life of the account is highly recommended. But, the last year is most important since we might require it when filing taxes at the end of the year.
  3. Before actually going to the bank to close down your account, make sure you have previously withdrawn all the cash. Again, be warned that it is not enough just to withdraw all your cash from your account and stop using it because it will likely continue to generate costs and/or commissions.
  4. Before closing the account, make sure you look at all pending transactions if any in order to make sure there are none that will leave you with an unpaid balance that will later affect your credit history. Also, make sure that all purchases made are final and that you don’t need to return any items you paid with your debit or credit cards or even checks because when you do ask for returns they are usually paid back the same way you paid for them. The most obvious recommendation is to make sure you have no pending incoming payments to the account you are closing, otherwise, this will make reception of said payment more difficult.
  5. If applicable, make sure you notify your employer or anybody paying into your account that you need your money to be sent elsewhere or into a new account.
  6. Again, if any loan or credit cards are associated or linked to the account you’re closing down, make sure to notify the pertinent parties so that you have no problems down the line.
  7. Formalise the closure of the account. Usually, you actually need to visit your bank and notify them your closing down the account. You must carry with you an official ID or passport. And remember that if your significant other or partner or associate or anybody else is linked to the account, they too must go to the bank with you.
  8. Lastly, ask for proof or certificate of cancellation of the account. If it’s an online account, make sure you research the steps for cancelling this type of account.

It’s important to reiterate that you must make sure that direct debit charges, such as Internet services, paid TV, utility bills and so on, are properly sorted out before cancelling an account in order to avoid unpleasant surprises. If you are switching payment of all your bills and reception of your wages to a new account, it’s probably much wiser to open this new account and making sure all is switched over properly before cancelling the account you no longer need or want.

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