PostFinance increasing fees – Migros the best Swiss bank ?

Posted on Categories Investment, Switzerland
PostFinance increasing fees – Is Migros the best bank _

I have used PostFinance as my bank for a very long time now. I have used it ever since my first pay, 14 years ago. For the most part, I am quite satisfied with it as a bank. I have a checking account and a few savings account on PostFinance. And I also have my third pillar on PostFinance. I was thinking of staying at PostFinance for most things except for my third pillar which I was thinking of moving to VIAC. However, it seems they decided otherwise.

Currently, I am not paying anything for my accounts. But PostFinance just announced that they are increasing their fees significantly (Source). Starting January 2019, I am going to have to pay 60 CHF per year for my account. This is not acceptable to me. The service will be exactly the same but for a higher price. I know this is not a lot of money. But this is the kind of things we should fight against. So I am going to change bank as soon as possible. In this post, I am going to discuss the new fees and the options I have as a new bank in Switzerland.

PostFinance – New fees

PostFinance logo
PostFinance logo

I have a Private account Plus on PostFinance currently. Until now, as long as I had 25’000 CHF on my account, I did not have to pay any fees. Starting from January 2019, I will have to pay 5 CHF per month. That is 60 CHF per year. That may not seem like much. But the fees are the thing you have the most control on. Therefore, it is very important for every investor to minimize fees. Moreover, PostFinance is not adding any new value to their account. You are just paying more for the same thing.

For some people, there is a way to get the fees waived. You need to have 25’000 CHF invested in funds in PostFinance. Since I do not have that much money invested in funds in PostFinance, this will not apply to me.

I have many accounts at PostFinance:

  • One checking account. This is the account I am using for my company to pay me.
  • Two savings accounts. One has actually been empty for some time.
  • One old investment fund with less than 200 CHF
  • My third pillar in PostFinance retirement 75 fund.

The first thing I did when I saw the news was directly to close the two savings accounts. Since I reduced the size of my emergency fund, it is small enough to be kept entirely in my checking account. Moreover, I also sold the last of my PostFinance investment fund. I have kept that fund for too long already. I lost about 10 CHF in the process. But this is a small price to pay to simplify my holdings.

Choices for cheap bank

After I decided to leave PostFinance, I needed to choose a new bank. I was thinking that there were still a lot of choices. But it seems that Swiss banks are really poor at providing a cheap service. To compare the many banks in Switzerland, I used the comparator at moneyland. From these results and my research, I have four good choices:

  1. BCV (Bank of the state Of Vaud): Fees of 0 CHF per year
  2. Migros Bank: Fees of 6 CHF per year
  3. Zak: Fees of 0 CHF per year (10 CHF per year with 5 withdrawals)
  4. BCF (Bank of the state of Fribourg): Fees of 30 CHF minus 1 CHF interest each. This makes for 29 CHF fees per year.

Mathematically, I should directly take the BCV offer. However, since I live in the state of Fribourg, I do not really like to go to a bank of another state. If I ever have to go in person in their bank, I will have to go too far.

The other very strong contender is Zak. Zak is a fully mobile bank. You only have an account on your phone. It is a model a bit similar to the model of Revolut, but limited to Switzerland. Zak is entirely free if you only use Bank Cler ATMs. However, there are no such ATMs close to my home or my work or where I do my groceries. Therefore, I estimate that I would do around 5 withdrawals per year at least. This would cost me 10 CHF per year. If I had such an ATM close to my work or home, I would go with Zak. But for now, I prefer to avoid this. Another good thing about Zak is they give you 50 CHF for joining. That would also cover the five first years of my costs.

Since it is only 6 CHF difference, I think it is better to go with Migros bank. Moreover, since I already have my credit card at Migros, I will have one less bank to worry about. It is also good to simplify its bank accounts.

Migros Bank – Almost free

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Migros bank is the bank of the Migros grocery shop. It is an old bank. It was founded 60 years ago, in 1958. Since I already am a customer of Migros and I shop there as well, I feel confident about this bank.

The main advantage of the bank is that the Debit Card is free. This is the only bank with the BCV to have a free debit card. Most debit cards in Switzerland are costing 30 CHF per year. My credit card is already at Migros. So I do not need a new credit card.

Unfortunately, Migros bank is not totally free. There are few fees. The most important fee that is difficult to avoid is 0.20 CHF for each incoming payment. I receive about 30 incoming payments on my account each year. That makes 6 CHF in fees every year. I am going to try to reduce that by moving several of the payments to my Revolut account. I will try to keep only my pay to my account. This would reduce the fees to 2.40 CHF per year.

The other important fee is the withdrawal fee for ATMs other than Migros ATM. There are not that many Migros ATMs around where I live. I will have to be careful and correctly plan my cash usage. However, I do not think this will be a big problem. I am already trying to minimize my use of cash. My small credit card cash back bonus is better than no bonus on cash usage. Moreover, I can also withdraw money in any Migros shop. There are a lot of Migros shops in Switzerland. I will try my best to keep this fee to zero. However, I will probably have to withdraw money once a year if something does not go well. This will two more CHF used.

There are other fees for payment abroad. But this is not an issue since I will also use my Revolut account for this.

Moving to another bank

Moving to another bank is not that simple. I need to change several things. First of all, I need to send the information to my company to get my pay in the right account every month. Then, I need to change the things I pay with direct debit. This is only one of my insurance and my credit card. This is very important to tell them enough in advance. You want to make sure that the bill does not go unpaid.

I also need to change some e-bills. Fortunately, I do not have a lot of e-bills. I only have my internet and my insurance bills. Again, it is very important to cancel e-bills. You can use e-bills again once you are on the other account. Even though e-bills make it more difficult to change bank, I still think it is so much more convenient. And it saves on paper which is also great.

I recommend keeping both accounts opened at the same time for at least one or two months. Otherwise, you are likely to miss one of the changes. This could end up in extra fees from an unpaid bill for instance. I think it is worth a few francs to avoid bigger fees.

There is one other thing that I will have to migrate. I also have my third pillar at PostFinance. Since I was already thinking of switching my third pillar to another vendor, this is not a big deal. I will sell my fund at PostFinance and then transfer my money to a new vendor. I am not totally sure about the new provider. But it will probably be VIAC. Expect a post to arrive soon about my choice of a third pillar!

If you are migrating to another bank, there is something I would recommend. You should try to make it more easy to change bank after this one. For instance, if you are debit direct, you can transform into bills instead. If you can transform some bills into credit card payments, that will be easier. You should also make a document keeping track of everything you needed to do to change bank. This will help you immensely the next time you need to do the same steps again.

Conclusion

Since PostFinance is raising their fees from 0 CHF to 60 CHF per year, I have to transfer to a new bank. The new fees will be effective starting next year. After some research, I decided I will switch to Migros bank. I will only pay around 6 CHF per year at Migros bank.

Changing the bank is not really easy. There are many steps necessary. I will have to be careful about it. If I do it in a well-organized way, this should be fine. I will try to make most of the transfer before the end of the year. We will see if I can do it all before January.

I have been a customer of PostFinance for more than 14 years. I would prefer to stay with them since it is a lot of work to switch bank. However, I do not see why I would have to pay more fees for exactly the same service. So I will do this completely emotionless and chose the smart way about it!

What do you think about the new fees? Which bank do you use? Do you plan to leave PostFinance because of this?

13 thoughts on “PostFinance increasing fees – Migros the best Swiss bank ?”

    1. Hi Mauro,

      I forgot to mention the 50 CHF reward for joining. I just added now to the article. That would indeed cover about 5 years of fees for me.

      As for the referrals, it is not something I want to rely on. We do not know how long they are going to keep that up. And I do not know if I could refer anybody.

      Thanks for this extra information :)

  1. I have been with PostFinance since I arrived in Switzerland in 2003.
    I’m not happy that they’re raising their fees.
    BCGE isn’t quite as great as BCV, they do have a few fees and charges, but I have my mortgage account with them. I really do like the idea of having all my accounts in one place, and at the minute I have the financial cushion to make the move.
    But then I think about the online interface of BCGE compared with PostFinance. Maybe it’s because I’ve grown with PostFinance over the past 15 years, but I know how to do everything and where to find everything. With BCGE, I still struggle.
    Thanks for a thought provoking post.

    1. Hello Kate,

      Having all accounts in the same place is a big advantage indeed. I really liked it before. But then, I had to use DEGIRO because PostFinance is really bad at etrading. And then, I had to use Revolut because all Swiss credit cards are bad at foreign transactions, and so on. So finally, I’m thinking that one or more outside of my main bank is no big deal :P

      I also worry a bit about changing the online interface. I really liked the one from PostFinance and I’ve grown used to it. From what I’ve seen, Migros is really really inferior on that side. But I still think it’s worth the switch.

      Thanks for stopping by :)

      1. Yeah, I had already moved from the PostFinance Visa to the Miles and More Mastercard, and I miss not having those transactions as part of the e-cockpit. So, it’s true, I already have accounts spread across three institutions now… I will talk to my account manager at BCGE to see how hard it is to move a 3eme pilier.
        I really enjoy your blog. It’s one of the few PF blogs based in Suisse Romande, and while I appreciate the ones out of the Swiss German side, yours is much more relevant.

  2. May I make a suggestion? Why not take the package “CA Essenciel” from CA Next Bank (Credit Agricole)?

    Provided you have a balance > 20k (which you seem to have, given you were a PF+ Customer), you’ll have free ATM withdrawals, no incoming payment fees or account management fees. Their saving accounts offer attractive .5%, too. There is a withdrawal period for the saving account, but if you treat your emergency fund, like I do mine, you will manage to get around that, too.

    I’m having some trouble seeing why you’d choose Migros. I get the point of wanting a physical location close by, but then you shouldn’t consider Cler either. Don’t underestimate the incoming payment fee – every incoming twint payment will be taxed, and that can add up quickly. BCV offers free cantonal withdrawals + 1 free non-cantonal bank withdrawal, which should fit your situation perfectly. Is there something I’m not seeing or are you weeny bit biased because you already have and like the cumulus card?

    But this is just my 2 cents, I like your articles a lot and will go to the same transition as you, so I wanted to share my reflections :)

    1. Hello,

      Please, make all the suggestions you want!!

      I had a balance of more than 25K at PostFinance, but only because my third pillar was here. But since my third pillar will not move to the new bank, my balance will be around 10K and sometimes less.

      The CA package is indeed a good package but only if you have a balance of more than 20K. Below that, it is very expensive, at 15 CHF per month.
      As for the incoming payments: since I also have a Revolut account, I will dispatch some of my payment there. If I accumulate too much money on Revolut I can send it back to my account and pay only one big incoming payment for several small.

      I may be a bit biased but not with Migros. I am a bit biased against BCV. I know it does not make sense financially, but I do not want my account at one of the cantonal bank from another state. It is not a good reason, I know, but I cannot help it ;)

      Thanks for stopping by and sharing :) I really appreciate it :)

      1. Thanks for this great article. I just want to give you some input:

        You cannot use Revolut for incoming payments, because they use a shared IBAN vor CHF payments. (They have been promising personal IBans for over a year, but my guess would be that they wont be coming anytime soon) And also the bank right now is outside of Switzerland, so there would be a hefty SWIFT transaction fee for every payment. I personally receive around 5-30 small payments (inc. Twint/CashBack etc.) per month, so Migros Bank can quickly become even more expansive than Postfinance. In my opinion this in-transparent nasty fee that you cannot control yourself is way worse than the CHF 5 p.M. from Postfinance… So I would not consider them even for a second. Also the Cumulus Mastercard you have doesn’t have any link with Migros Bank – it is issued by Cembra Moneybank, the only link is the logo on the card and the fact that you get Cumulus Points.

        Regarding physical location of your bank, just ask yourself this question: Have you ever had to visit your bank? Because at least I did not need to visit my bank (postfinance) even once during my whole live. So I went with BCV, my account is already opened and everything looks great so far. I didn’t need to visit them to open the account, opening can be done online and you sign with Mobile ID. They even send the letter in German (I don’t even speak french) to Zurich.

        I already have a ZAK account but it’s not an option for me because there is too much missing right now: No Banking from PC, no payments above 10k (How should I pay taxes), no E-Bills, no withdrawl from other banks.

        1. Hello Thaek,

          Thanks :)

          Yeah, I know very well about the Revolut issue. But I’m using TransferWise as an intermediary before Revolut. This makes transfers free. I am also guessing that they are not getting that CHF IBAN for a long while now. I maybe receive 30 payments per year, so it’s not a big deal for me.

          Actually, I had to visit PostFinance twice in that time. It’s not a big deal, but still a thing.

          Yeah, ZAK is interesting, but too much missing features yet. It may come in the future though.

          As I said before, I’m biased against BCV without any good reason. It’s an excellent option, no denying that. I’m just not getting to open an at BCV.

          Thanks for stopping by Thaek :)

  3. Hey,

    Have you heard about the Alternative Bank Switzerland ? Here’s the link for their website : https://www.bas.ch/fr/ (it’s fully available only in French and German unfortunately)
    The annual fee is only CHF 36.– per year for their basic account (plus CHF 30.- per year for the Maestro Debit Card), but if you are able and willing to invest in them by buying 10 shares, the fees drop to CHF 0.- (even for the Maestro Debit Card).
    I personally find it interesting because by buying their stocks you support sustainable and alternative investment.

    Cheers

    1. Hi Charles,

      No, I never heard of it before. It looks very interesting. I think it is a really good idea on their side. On the other hand, this represents an investment of more than one thousand CHF. I am not ready to invest so much in a single bank.

      Thanks for stopping by and sharing !

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