Here at Boomerang Ed, we’re making it our mission to help students with all things finance.
Banks can be tricky because, despite stating the facts, consultants are effectively salespeople and will often use gimmicks to try and tempt you to accounts that might not actually be the best for you.
So we’ve put together a few factors that should help you figure out how to pick a bank account for university 🙂
How to pick a bank account for university:
First things first, student accounts work just like normal bank accounts but you can only open them if you are in or about to start higher education. They come with extra features so here’s what you should be looking out for:
1) Look out for hidden fees
Bank accounts can come with all sorts of fees that you might not realise at first, such as:
- Fees for failed standing orders or direct debits
- Monthly or annual fees for holding the account
Most accounts will also charge you for:
- Sending money to another country
- Withdrawing cash abroad
- Requesting copies of old statements
If you think you’ll be making use of these services frequently, make sure you choose an account with low fees.
2) Find out how you can use the account
Most student bank accounts should be offering you:
- A debit card
- ATM withdrawals
- Telephone banking
- Online banking
- A mobile phone app
- Contactless payments or a service like Apple Pay
3) Research the best overdraft
- Overdrafts allow you to keep spending money, even after the balance in your account reaches zero.
- If this happens, then your account will show a negative balance. For example, if you withdrew £20 with just £5 left in your account, your new balance would read -£15
- Look out! Overdrafts tend to charge interest on the money you borrow. However, many student accounts offer interest-free overdrafts of up to £3,000, so make sure you look at all the options.
- Be careful not to spend beyond the overdraft limit (you can find this out from your bank) because you will be charged fees, which could damage your credit record.
4) Is there a branch nearby?
Having a branch that is local will be useful if you need to:
- Take out cash if you lose your card
- Pay in cash
- Pay in a cheque
Student bank accounts will often offer you free stuff which can include:
- Free software e.g. Microsoft Office
- Free student railcards e.g. 16-25 railcard
- Gift vouchers
- Discount cards like the Tastecard or an NUS extra card
These freebies can be great – just make sure you’ve looked at all the other factors we’ve mentioned first. Finding an account that offers everything you need is more important than the perks!
Take a look at this handy comparison of all student current accounts to find one suitable for your needs.
If you have any questions, feel free to get in touch with the Boomerang Team! 🙂