How to Choose the Best Student Bank Account
Making the Most of Student Bank Account Offers Saves Money
Aug 18, 2009
New students who are about to hit campus for the first time may need to set up a bank account to help them manage their finances. For many, this is their first time away from home, and making sure that they have the best student bank account behind them can be a good step to take. Most bank accounts of this kind will try to entice new customers by offering a range of freebies and goodies. Attractive as these may be, they aren't the only student bank account offers that need to be considered.
What Will the Best Student Bank Account Offer?
This isn't just about getting the best freebie out there, attractive as it may seem. It's also a question of looking at what any account offers in terms of financial features and benefits – this is the whole point of the account, after all! The main thing to look for here is the overdraft and how it works.
Many student bank accounts will come with preferential overdraft deals. The aim here is to look for accounts with larger overdrafts that charge 0% interest or the lowest alternative rates. It's not a good idea to use an overdraft regularly, but if it does become necessary to borrow money this way, it's a good idea not to have to pay extra for it.
Do bear in mind, however, that the overdraft limits that might be quoted in a general student bank account comparison might not be given to every student. Credit scoring may mean that some get a lower overdraft limit than others and some banks will start low in any case and increase limits to their publicised level year on year.
What About Student Bank Account Offers?
Many banks use their offers as their "in" with a new customer. There's nothing wrong with looking for the freebies but it is recommended that this isn't the only reason for choosing an account. So, what kind of stuff is on offer this year?
- Free 16-25 railcards – these can be useful for people who will travel a lot by train as they can save up to a third on ticket costs. Look for offers that last for more than one year and the conditions that will allow the freebie to continue year on year.
- Money – some banks will offer hard cash incentives when students sign up. Cash in hand may look good but this will only work if there is a good deal overall. If students end up having to give the cash back in charges down the line then this doesn't work.
- Free/reduced insurance – some accounts come with deals on travel, car, breakdown and contents insurance. This can be useful but, once again, not if it ends up being paid for elsewhere.
- Free music downloads – music lovers often opt for accounts that give them free downloads. These kinds of student bank account offers may, however, come with clauses. For example, they may not be given to people who already use the download service. And, they may be available to students via the download service itself without the need to take out the account in the first place.
- Technology discounts – some banks will give discounts on equipment such as laptops, broadband access and mobile phones. These can be useful if this stuff will need to be purchased for college, not so useful if it won't. Bear in mind as well that many campuses have their own Internet access set into place in any case.
The way to find the best student bank account really is to look at the accounts that will save as much money as possible and cost as little as possible. Freebies can be great to get, but do look at what they are worth in real terms before coming to a decision.
Students may also want to take a broader view and think about other ways that they could save money. Choosing the right student credit card, for example, can be just as important as choosing the right bank account. Looking for money saving tips and using online voucher sites can also be useful ways of saving money.
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