Should you keep all your accounts, loans and investments at one financial institution, or spread them around?  When I worked for a bank, when I had a new customer referral – for a mortgage, say – the goal was to transfer in all of their financial accounts.  The reasoning behind this was that it would be more difficult to leave the bank once everything was set in place, and it’s true.

Whenever I have a complaint about my service and I vow to move all my accounts elsewhere, I think of the pain it will be to research a new bank, open and transfer all my accounts, perhaps they will hold all my deposits until they get to know me, I’ll have to learn a whole new system, aiy, aiy aiy!  I guess I’ll stay put.

So, we know the bank is trying to keep you as a customer indefinitely, but what are the advantages to you to have all your finances in one place?

  1. When you go on-line, all your accounts are there, on one page, giving you a quick overview of all your balances.
  2. Links to investments and loans show holdings and recent activity and you can download them to accounting software like QuickBooks or Microsoft Money easily.
  3. Transferring funds between accounts is quick and simple.
  4. Past banking statements can be accessed on-line for the past two years or more.
  5. By consolidating similar accounts, you can often save money on fees.  For example, a direct trading RRSP account charges an annual fee of $100 for balances under $25,000 and trading fees are reduced for balances over $100,000.  So, if you’re paying fees on spread out small accounts, this could work for you.
  6. You may get to know a financial advisor at your branch who knows you well enough to recommend new products that will fit your financial plan.
  7. It can be a good bargaining tool to get a better interest rate – e.g. higher for GICs and lower for loans and mortgages – or other perks.

I personally keep most of my accounts with one financial institution with a couple of exceptions where I get a better deal elsewhere.  But, I’m always open to offers and negotiation.

Do you have accounts at multiple banks, or are you loyal to just one?

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