Student Accounts

When you are heading off to university, the things that you need from your bank account will change. Firstly, you may need to have an overdraft facility for the first time, meaning that you agree with the bank that you can spend more than the amount of money you actually have, up to a certain limit. Such is the competition among banks to attract new customers at university level that you will usually be able to get an overdraft of up to £2,000 with no charges. However, fees will be charged for going over your overdraft limit, so make sure that you stay within the conditions that have been set by the bank.

Although previously it may have suited you fine to just have a cash card to withdraw your money from ATM machines, you will now have other considerations. For example, if you are living in a rented property, you will usually be expected to pay your rent each month by standing order. Your student account should therefore give you the facility to set up direct debits and standing orders for rent and also for other household bills. Having a bank branch close by is hugely useful when you are comparing student accounts, because it makes it much easier to pay in cheques and cash and to ask for advice and support as and when you need it. After all the student account features and the convenience factor have been taken into consideration, only then should you compare the freebies! Take your time when choosing a student bank account however, and don't be pushed into anything by the reps at freshers' fairs. Your relationship with your bank will usually last far longer than your university career, so it makes sense to be absolutely certain that the account is right for you.

Student Accounts: Points to Consider

  • Does your bank charge you for your student account each month?  If you are looking for the basic features of a student account; overdraft facilities, direct debits and standing orders, and a debt card and chequebook, you should not be charged a monthly fee for using your account.  If there is a fee, speak to the bank and ask them what it is that you are being charged for. 
  • How much access do you have to help and support?  You should be able to speak to a representative of your bank 7 days a week.  If your account has online banking enabled, you should have access to your account 24/7.
  • Does your student account offer you additional features, such as mobile phone insurance or breakdown cover? If so, you may be charged an additional fee for these 'benefits'.  Only keep these (and keep paying for them) if you are genuinely going to make use of them and they are saving you money.  If they are not, opt instead for a free account. Make sure you read the small print before signing up to an account to make sure that there are no hidden charges.
  • Beware of the 'buffer zone'.  Student accounts will often have a buffer zone, so that if you go over your overdraft limit you will still be able to take money out.  This is supposed to look helpful, but the bank will charge you large fees for this service so keep an eye on your balance and stay within your limit wherever possible.
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