Close your savings account only if you have a concrete reason — moving banks, consolidating accounts, or ending a relationship with your current bank. Closing an account you still use costs you money in fees and removes a safety net. If you're thinking about it because the interest rate is low or you're not using it much, switching banks or keeping it open costs nothing.
Key Takeaways
- Closing an account triggers fees at some banks, and you must withdraw or transfer your balance before the account closes.
- If you close your only savings account, you lose the ability to set money aside for emergencies without opening a new one.
- Low interest rates are not a reason to close — you can move your money to a higher-yield account at another bank without closing the original one.
- Banks report closed accounts to ChexSystems, which can affect your ability to open new accounts at other banks for up to five years.
- If you have a refund, tax payment, or government benefit headed to that account, update the deposit information before you close it.
Reasons that actually justify closing an account
Close your account if you're switching to a different bank entirely and have no reason to keep the old one open. This makes sense when you've moved to a new state, found a bank with better terms, or want to consolidate multiple accounts into one place. It also makes sense if you're closing an account tied to a relationship that has ended — a joint account with an ex-partner, for example, or an account opened under someone else's name.
Close an account if you're paying monthly maintenance fees and can't waive them. Some banks charge $5 to $15 per month if you don't maintain a minimum balance or don't set up direct deposit. If you can't meet those conditions and the bank won't remove the fee, the cost adds up fast. Before you close, call the bank and ask whether they have a no-fee version of the same account — many do, and switching to it takes five minutes.
Close an account if it's dormant and the bank is charging inactivity fees. A few banks charge you for not using the account for a set period, usually six months to a year. Check your account agreement or call the bank to confirm the fee exists before you assume it does.
Reasons that are not good enough to close
Do not close an account because the interest rate is low. Savings account rates change constantly and vary wildly between banks — some offer 4% or higher, others offer 0.01%. If your current rate is poor, move your money to a bank with a better rate. You can do this by opening a new account at the higher-rate bank, transferring your balance there, and leaving the old account open. Closing it gains you nothing.
Do not close your only savings account because you're not using it much. An unused savings account is not costing you money (unless there are fees), and it serves as a backup if an emergency happens. If you have no other savings, closing this account means you have nowhere to put money if you need to cover an unexpected bill. Opening a new account later takes time, and some banks will deny you if you have a history of closing accounts quickly.
Do not close an account to punish the bank for poor customer service. Switch your money to a competitor instead. Closing the account does hurt the bank slightly, but it also creates a record that follows you — banks share information about closed accounts through ChexSystems, and too many closures can make other banks reluctant to open accounts for you.
What happens when you close a savings account
Before an account closes, you must remove all the money in it. You can do this by transferring the balance to another account at the same bank or a different bank, or by withdrawing cash. The bank will not close the account until the balance is zero. If you have pending transactions — a check you wrote, a bill payment scheduled, a refund headed to that account — those can still post after you request closure, which can overdraft the account or cause confusion.
Some banks charge a closure fee, usually $25 to $50, though many do not. Ask before you close whether there is a fee. If there is and you're moving your money to the same bank, ask whether they'll waive it if you open a new account with them at the same time.
The bank will report the closed account to ChexSystems, a database that tracks banking history. This record stays for up to five years. If you close multiple accounts in a short time, other banks may see a pattern of account-hopping and deny you when you try to open a new account. One or two closures rarely cause problems, but a string of them can.
Steps to take before you close
Check whether you have any automatic deposits or payments tied to this account. If your employer sends your paycheck there, your insurance company withdraws premiums, or a government agency sends you a refund or benefit payment, update those first. Call the bank or log into your account to find the list of automatic transactions. Update each one to point to a different account, or contact the payer directly to change the deposit or payment account.
If you're waiting for a tax refund, stimulus payment, insurance refund, or any other payment headed to this account, wait until it arrives before you close. If the payment arrives after the account closes, the bank will reject it and send it back to the payer. Getting it reissued can take weeks or months.
Review your account statements for the past three months to make sure you haven't missed any recurring charges or subscriptions. Streaming services, gym memberships, and app purchases often come out of savings accounts without much fanfare. Cancel or move these before you close.
Write down your account number and routing number before you close. You may need them later to prove you owned the account, especially if a payment arrives after closure or if you need to dispute something.
How to actually close the account
Call the bank's customer service line or visit a branch in person. Online closure is rare — most banks require a phone call or in-person visit. Have your account number ready. The bank will ask why you're closing and may try to keep you as a customer by offering to waive fees or move you to a different account type. You can accept or decline.
Confirm the closure date. Some banks close immediately, others take a few business days. Ask what happens if a payment arrives after the account closes, and get the bank's mailing address in case you need to contact them later about the account.
Request written confirmation of the closure. This is not always automatic, but it's worth asking for. The confirmation should include the closure date, your final balance, and confirmation that all money was withdrawn or transferred.
If you're closing because of a refund or payment issue
If you're closing because a refund or payment never arrived, do not close the account yet. Contact the payer first — the IRS, your state tax authority, your insurance company, or whoever sent the money. They can tell you whether the payment was sent, when it was sent, and to which account. If it was sent to this account and never arrived, the bank may be able to trace it. Closing the account makes tracing impossible.
If the payer confirms the payment was sent to the wrong account, ask them to reissue it to the correct account. This usually takes one to two weeks. Once the new payment arrives, you can close the old account.
Frequently Asked Questions
Will closing my savings account hurt my credit score?
No. Closing a savings account does not appear on your credit report and does not affect your credit score. Credit scores track borrowing and repayment history, not savings accounts. However, closing multiple accounts quickly can make other banks hesitant to open new accounts for you, because ChexSystems shows a pattern of closures.
What if I close my account and then a payment arrives?
The bank will reject the payment and send it back to the payer. The payer — the IRS, your employer, an insurance company — will then have to reissue it. This can take weeks or months. Before you close, make sure no payments are headed to that account, or wait until they arrive.
Can I reopen an account I just closed?
Usually yes, but it depends on the bank and how recently you closed it. Some banks let you reopen within 30 days with no penalty. Others treat a reopened account as a new account and may charge a fee or require a new deposit. Call the bank and ask before you close if you think you might change your mind.
Do I need to close my account if I'm just switching banks?
No. You can open a new account at a different bank and leave the old one open. This is actually safer — you keep the old account as a backup in case something goes wrong with the transfer, and you avoid the ChexSystems record of a closure. Once you're sure everything is working at the new bank, you can close the old one if you want.
What if the bank won't let me close my account?
A bank cannot refuse to close your account if you request it. If they claim they can't, ask to speak to a manager. If they still refuse, file a complaint with the Consumer Financial Protection Bureau (CFPB) at consumerfinance.gov. Include the date you requested closure and the names of anyone you spoke to.