As a student in your first term, bank accounts are possibly the last thing on your mind, however there are plenty of bank account options and it’s an important decision that needs to be made. Managing your finances with a student overdraft will ensure that your account doesn’t go overdrawn and you are not hit with any major fees when money begins to get tight.
Student banks accounts offer great 0% overdrafts and lots of added perks, it all comes down to your choice of lender that could affect your finances heavily.
What is a Student Bank Account?
A student bank account is very similar to a current account except that it comes with an interest-free overdraft which helps you have no fees and extra cash throughout your studies.
Some banks/building societies allow you to have access up to £3,000 without paying any interest back across your studies and this will allow you to snap up some interesting perks as the banks are commonly competing with each other.
Do I need a student bank account?
A student bank account is one of the best way to manage your finances when at university.
Most students will need a student bank account as it is the safest way to borrow money if it is needed. Most websites and lenders will suggest the highest overdraft however we would advise against this, only borrow what you need.
All student accounts offer a maximum and minimum overdraft, research the different options and pick an overdraft that best suits you. Having extra money will encourage you to spend unnecessarily, there are both advantages and disadvantatages and if you are not careful with what you are spending, you may fall into a dangerous financial situation.
Money saving expert has a great list of student bank accounts which is available here.
What if I don’t need a Student Bank Account?
Not all students need a student bank account and if you’re lucky enough to be consistently in credit while studying then you’re a rarity, only joking! There are plenty of bank accounts that can offer a great 4-6% AER on your balance allowing you to make a profit with your student loans.
Best Student Accounts
There are many bank accounts available which offer different overdraft amounts along with various freebies. When researching accounts, you must consider what offers you the best interest free overdraft and what the maximum limit is – remember that the overdraft limit depends on credit score also.
Some of the best students accounts can be found by these banks: