How to Pick the Best Student Bank Account

If you are a student or you have a child that is a student then you may be on the look for a specialist student bank account. It is a good idea to think this through quite carefully. Many banks and building societies want to encourage students to bank with them. They would like them to start off banking with them in the hope that they will continue to bank with them once they start working. They will also be keen to have that student loan money paid in so that that they can have it in their bank. Lastly, they may be keen to take on a student who might need to use an overdraft as they will benefit from the fees that they charge on that. However, with so many to choose form, it is important that the student picks the one that suits them the best, rather than just picking the one that looks most attractive. There are various things that they should be looking out for in a good student account.

Cheap Overdrafts

Most student accounts will offer an overdraft. The banks and building societies will assume that students will be hard up and that they will need extra money. This could very well be true and it could be extremely useful to have access to an overdraft. Some of the places even offer free overdrafts for the full time the student is studying. This can be extremely useful. It could even be utilised by students who do not need to use an overdraft. They could potentially put the money into a savings account and gain the interest on it and then repay it to the account before interest starts having to be paid (which is likely to start as soon as the course ends). This can be a good way to make a little extra money, although it will only be a little bit with savings rates being so low, but it is worth considering. When comparing the overdraft rates, make sure that you find out whether those rates will change one the student graduates and what the rates will change to. 

Freebies

Some student account will offer freebies to students. For example, they may offer a free student railcard which normally has to be paid for and can give students around a third off train fares. If the student was going to buy one, then this could be a great freebie. However, some freebies will not be so useful and so it is worth making sure you check what they are calculate their value and work out whether they will benefit you. Even if you have hundreds of freebies they will not be any good to you if they are not things that you will use.

Interest

Even though these accounts are effectively current accounts, some may offer interest. So, look into this carefully and think about whether this will be worthwhile. You will need to consider whether you think that it is a good idea to take out an account which pays higher interest or whether the cheap overdraft and freebies are more worthwhile going for. No account will have it all and you will need to compare them and try to guess which will be best for you. Remember, that you will be able to switch, so if you find that the account you have chosen is just not right then you can move to another. It is well worth doing a yearly check anyway because you may find that certain account change in how competitive they are and you may find that the account that you thought was best one year, turns out not to be so good the following year.

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