1. Know what you want your student bank account to do
Get a head-start when comparing the options:
Always stay in credit? Freebies and higher interest paid on positive balances earn extra for your cash.
Always broke? Forget freebies. Compare student bank accounts by lower charges for borrowing or over-spending (more about that below).
Need a nest egg? Compare options that grow your money faster. Don’t automatically go with the savings account bundled with your current account, either, unless you like being taken for a ride.
Just want it to be easy to manage? Get a flavour of what the account’s like to run
2. Go by what it does, not what it’s called
Graduate and student bank accounts tailor their terms for students, including how much you have to pay in each month, or lower charges for over-spending. The 0% overdraft is also reserved for student accounts. If you struggle to stick to a budget, they’re a better option.
Regular accounts have better benefits, such as paying higher interest or rewards for opening accounts, but expect larger minimum pay-ins and charges, too. If you’re always in the black, a regular account could earn you far more in the long term, especially if you set aside part of your student loan or wages to siphon in (and back out!) to meet pay-in terms.
Many regular current accounts also beat savings accounts for interest, too. The lesson is: don’t just look at a student bank account, consider regular current accounts as well!
3. Borrow for less
Chances are you will need to borrow from the bank at some point.
Plan it right and it’ll be easier to pay back and add less to your debt.
A 0% overdraft is free to dip into – if you stick to the terms. That means not spending more than the limit and paying back on time. Don’t chomp through your overdraft: keep it until you really need it!
Go by the guaranteed overdraft amount when comparing accounts (if it says “up to”, you may get much less).
No overdraft option? There are 0% deals on credit cards out there, but you’ll need to plan properly to pay them back or risk hefty charges.
Whether it’s 0% or not, defo compare charges and interest for using or overspending on accounts.
If you can’t borrow for free – whether banks or family – get advice from your welfare team before loading up on private loans.
Hardship funds or bursaries are a better deal, and many don’t have to be paid back.
4. Polish your credit rating
Your history of managing money can make a difference to whether you get the best banking or borrowing deals (a bigger overdraft, or being able to get a credit card). It can be harder to wangle if you’ve never had a bank account before (catch 22 much?), but consider it a long-term goal to keep working at: