Student banking: Advice for a student bank account

Student bank accounts are necessary for your time in college or university, especially if you will apply for student loans. Student loans are ideally best paid directly into student accounts. The main difference between a student account and a standard current account is that a student account offers interest-free overdraft.

When choosing a student bank, you need to think about a number of key decisions and pay particular attention to advice for a student bank account in order to open and ran the right account for you.

Choosing a bank

One of the key decisions you will need to make when opening a student bank is on the actual bank to use for managing your finances. This decision on the bank to use can have a huge impact on your wealth and so it is in your best interest to approach it conscientiously. Always read the fine print of the account details so you fully understand what you are getting into.

Most banks will offer different 'freebies' like free gifts and vouchers to woo you to open an account with them, but you need to look past the freebies in order to get long term benefits. Lean toward banks that offer the largest interest free overdrafts, even though you might not be entitled to the full overdraft amounts.

Considerations when choosing a bank

If you are not sure on the bank to choose, consider if the bank you have identified has a branch near you where you can easily call in to discuss your finances. Also, consider whether the bank has a cash machine near where you live or on campus and whether you can use the bank's cash point card at other banks' machines without being charged.

Do also consider the bank's services and charges. Does the bank you identify have a student adviser? A student adviser can be quite helpful because he or she is likely to be more sympathetic and understanding of students’ financial situations.

Moreover, consider the type of interest free overdraft that is offered and how to apply for it. Can you extend your overdraft limit? How do you do this? Does the bank offer preferential terms to graduating students? How long after you complete your course do you receive preferential student terms, if at all they are offered?

Sound student banking information and advice for a student bank account require that you carefully consider and answers these questions in order to identify the right bank for you.

Best banks for students in UK

The best banks for students offer the best guaranteed overdraft. Guaranteed overdraft allows you to spend more money than you have in your account up to a certain limit, which is determined by a number of factors like whether you make regular payments into your account. The Co-operative bank is our number one best bank for students, as of 2012 mainly because it offers the largest guaranteed overdraft.

Halifax and HBOS accounts can potentially give larger overdrafts than Co-operative bank, but you will need to have very good credit scores to get the overdraft. Other highly recommended big players with excellent student accounts and services are Santander, Natwest, RBS and HSBC. These banks actively work hard to provide student customers advice on student bank account products and actually deliver excellent student banking services.

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