Customer loyalty is not a virtue in banking

Women are more likely to fall into a “set and forget” mentality when it comes to their banking - and it's costing them money.

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Women are more likely to fall into a “set and forget” mentality when it comes to their customer loyalty in banking.

New research shows that 40 per cent of Australians are still with the same bank that they signed up for as a child, which means they are most likely falling victim to the “lazy tax”.

The research indicates that many Australians aren’t being proactive about seeking a competitive deal and could be missing out on big savings and rewards as a result.

Women tend to be more loyal to their bank with 42 per cent of women still with their childhood bank, compared to just 37 per cent of men.

Interestingly, women are not actively thinking about switching banks, with 10 per cent admitting that “it hadn’t occurred to them to switch” compared to 8 per cent of men.

Women are also more subject to the “lazy tax”, with 10 per cent admitting that they “couldn’t be bothered to switch” compared to 8 per cent of men.

Many people don’t switch banks because they put the idea of doing it in the “too hard” basket.

There’s a perception that switching banks will be a painful and lengthy process. However, switching banks or providers is easy and it can save you hundreds or thousands of dollars.

Currently, the average maximum savings account rate is 2.67 per cent, based on a $5,000 balance, so bear this in mind when comparing savings accounts online.

If you’re not happy with your current interest rate, try and negotiate for a better rate with your existing provider.

Most banks will provide you with a better rate if you can show that you’ve done your research and give examples of competitors that are offering a better deal.

On a $20,000 balance, every 0.25 per cent increase that you earn on your savings can mean an extra $50 a year in interest, so it’s worth shopping around.

Of course, bank loyalty doesn’t only apply to your savings or transaction accounts, it applies to all your accounts including credit cards and loans.

When reviewing your accounts, remember that there’s no point staying loyal to your bank if it’s costing you money.

Consider whether you’re getting the best rate, the lowest fees and the most useful product features and then decide whether you want to stay or go.

Frequently reviewing your financial accounts will help ensure you’re getting the best deal for your personal circumstances and it could save you thousands of dollars in the long run.

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