Mapped your move and ready to go? Before you Act, read this primer
Moving your banking, super and shares isn't hard, but it's important to get it right. Here's some pointers to make your transition smooth.
Bravo on getting this far!
Having chosen the banks, super and/or shares moves you want to make is the hardest part (in my opinion, anyway!)
If you haven’t already, take a mo to feel proud 🥳
Of course, as we used to say onsite:
The job’s not done till the paperwork’s done.
And this step’s all about the doing, and doing it properly.
Before we leap in…
Did you ask your current provider to change?
Whether you used an existing service like the ‘Tell them to stop’ links on Market Forces’ pages or picked up the phone, you’ve done an excellent service by telling your bank, super fund or the companies/funds you hold shares in why they’re not up to snuff.
The point of all this effort is to get them to change, after all.
If your experience was anything like mine, you probably got a canned response full of marketing speak. This can be confusing, but the point is:
Have they removed fossil fuels from their lending/investing?
You can double check by repeating the audit process.
If no change, on we go!
Things to note before moving
Just like choosing where to move was a methodical process, so too is choosing when you’ll move.
I am referring of course to the impact of capital gains on your tax bill.
» Tax is inevitable
…but you don’t have to leave a tip.
It’s worth doing what you can to legally minimise the tax you owe. Which is where planning makes a brief re-entry to the discussion.
Your accountant may have suggestions as to the timing of the sale of shares, for example. They’ll be able to talk you through options like choosing a specific financial year.
But they can only help you before you do the move.
Once you click sell, the opportunities to optimise shrink.
So, ask them first.
I asked mine about the share sales, and she confirmed the timing I had planned was optimal. So, no changes needed but I could sleep better knowing I’d got the timing right.
Don’t ask? You’ll never know for sure.
» The goal is to be in a better financial position
Yes, you might have chosen a slightly higher fee super fund or index fund. But aside from that, the money moves should not be sending you backwards financially.
Remember there are swathes of professionals you can consult to be sure you’re doing something sensible, as outlined with all the links you need in the Plan post, including:
Financial counsellors
the Financial Information Service
Money coaches
Financial adviser (including ethical advisers who specialise in this topic)
Accountants, and
Advice via your super fund.
Things to note while moving
Moving your money is a task to be treated with respect and care.
You don’t want to make avoidable and potentially costly mistakes, right? Timing and process matter. Caution is sensible when it comes to executing the actual moves.
You particularly want to do everything in your power to make sure you:
» Don’t get sucked into a scam site
While the chances of clicking on a scam version of the financial institution you want to use is veeeeery low, it is not zero.
Take the cautionary tale of one of my former colleagues at BHP, Jacomi Du preez.
When she received her husband’s life insurance payout following his death in a car accident, Jacomi went looking for a term deposit in which to park the money for a few months till she had the mental space to decide what to do with it.
Excellent idea. The adage ‘make no big money choices in the year after bereavement’ is solid.
She chose Macquarie Bank, as an online search revealed they were offering ever-so-slightly above the interest rate of competitors. Like, 0.1% more. Nothing really alarming.
Jacomi did what I would consider rigorous due diligence.
Tracking down the Macquarie employee on LinkedIn to verify he was real and worked for Macquarie for example.
But it turned out the site she’d landed on was a clone used by scammers.
It wasn’t Macquarie at all.
She transferred the full $760,000 before she realised.
Jacomi is an accounting professional specialising in risk and assurance. Even *she* fell for a scam of this sophistication.
This is why we should not blame victims of scams (not too much, anyway). If it happens despite your best efforts to avoid it, lease don’t see it as a failure of your capability. Scammers are getting better and better at fooling us.
Of course, the big question is why the search engine allowed the scammy clone page to exist and either pay for ads so it turned up at the top of the searches or refine its search engine optimisation (SEO) until that happened organically 👀 I’m watching Singapore’s move to fine online entities which fail to remove impersonation scam sites closely.
But I digress…
This story has a happy ending. Thanks to her financial nous and help from various institutions, Jacomi tracked the payment as it moved from place to place, managing to convince the last institution to freeze the money so she could get it back.
This is fabulous, but exceedingly rare. And I wonder what the stress of that 1.5 weeks did to her mental and physical health.
People, odds are you won’t have Jacomi’s outcome.
You have to check, check and check again before moving a cent.
For example, call the call centres - which you find the number for, do not accept the number provided to you - to make sure the person you’re speaking to is an actual employee if you must.
Scamwatch has excellent tips on spotting scams, check out their pointers.
» Sidestep any luckily-timed phishing scams
Financial products have to comply with anti-money laundering and counter-terrorism and fraud (AML/CTF) requirements. Which are improving all the time to deal with new and creative ways criminals try to get around the rules.
In short, banks and the like have to know you are you and be sure you’re a real person when you sign up for an account. Otherwise they’re breaking the law.
The onboarding process is broadly known as Know Your Customer (KYC).
During it, you’ll be doing things like uploading identification and providing birth dates.
There are plenty of opportunities for a crafty scammer - or just one with incredibly lucky timing - to catch you off-guard as you upload IDs or enter six-digit codes you’ve been texted.
The trick is not to rush with *any* of this.
I cannot think of a financial institution in the world who would rush you through their onboarding process, or apply any sort of pressure tactics to get you to sign up.
They want you as a happy, comfortable, lifelong customer. They’re not going to be trying to put you off-kilter before you’re even signed up.
Definitely a red flag if you get that vibe.
If you get any requests for ID, passwords, confirming personal details outside of the official onboarding process, do as Scamwatch says:
» Move your moolah gradually (if you can)
…particularly with bank accounts.
If you’re setting up a brand new account with a brand new bank, don’t transfer the entirety of your life savings to it on the first go.
Start by moving a little bit.
Wait a while (e.g. a couple of weeks) to make sure the payment works and got to the right spot, and there’s not bounce-back or other shenanigans.
With all this in mind, it’s time to get the moving happening! Onto moving your bank account/s…