student account – Larrysteenbass.com

Students need money – it’s a fact of life! They need money to live, to pay their bills, to pay their rent and to pay their way through college, and many student bank accounts offer incentives such as large 0% overdrafts, freebies and more. Learn what to look for in a student bank account and what you need to know about using student accounts below.

Look for the Biggest 0% Overdraft

Banks try their hardest to entice students and they’ll use a whole host of tips and tricks to get you through the doors, but it’s important that you hold out and wait for the biggest and best overdraft at a 0% interest rate – unless the freebies beat it. Some banks offer travel cards that’ll give you a huge percentage off of travel across the country, and this could be a good option for you if you do lots of travelling. Some banks will offer freebies like televisions and games consoles and again, this could be a good option if you were going to buy one of these anyway. Generally though, your best option is to go for the biggest 0% overdraft so you have those additional funds in place just in case.

Look for the Lowest Interest Rate

An overdraft might be charged at 0%, but if you go over that overdraft limit, you’re in dangerous territory as far as interest rates are concerned. Interest rates outside of your overdraft can range from 20% to 35% and so it’s a good idea to choose the account with the lowest interest rate outside of your overdraft just in case you go over your limit. Keep in mind however that going over your limit can also incur one off charges and it might also have an effect on your credit score, so be sure not to go over your limit unless it is absolutely necessary.

Don’t Choose the Closest Bank or ATM

Most students don’t do their banking within the bank anyway – they just use ATMs to withdraw money and their internet bank account to do their day-to-day banking. Instead of choosing the closest bank or ATM, or choosing an account because that’s where your parents have banked, look for the best offers and deals. And remember, just because an ATM is branded with a certain bank doesn’t mean that you can’t withdraw money from it if you bank with another provider – virtually every ATM is open.

Switch to a Graduate Account

Once you’ve graduated, make sure that you switch to a graduate account to get the very best offers and deals. Unless you’ve got into a lot of debt throughout your time at college, you’ll be able to use lower interest rates and lower interest overdrafts to pay off the debt that you’ve accumulated. If your debt is particularly high, you might not be eligible for these types of accounts, so it’s really a good idea to limit your spending through college and only use overdrafts, loans and credit cards that you can afford to pay off.

Finally, what you might not know about student accounts – your credit history starts with your student account, so be sensible with it!

Being a student is always tricky – you’re somewhere between being a child and being a fully-fledged adult and you’re trying to find your way in the world. Student bank accounts are just one example of how students get a little bit of a short deal during their late teenage years – they need their own bank account, but they’re unable to get an adult account and they’re too old for a children’s account. Luckily, there are a few bank accounts that are specific to students – although which bank account you end up with depends on which type of student you are. Take a look at our quick guide to student bank accounts for more advice.

Young Person’s Account

Most banks offer a “young person’s account”, usually targeted at students either just below the age of 16 or just over the age of 16. Generally, young person’s accounts offer most of the benefits of a children’s account, but in a lot of cases, young person’s accounts have limited functionality in terms of paying money in or out. Most young person’s accounts can accept money, while debit cards associated with young person’s accounts can pay for items online and in shops and withdraw money from automatic transaction machines, but many of them can only pay out in cash. That means that direct debit payments cannot be set up from a young person’s account, although this will differ from bank to bank.

Student Account

Student accounts are typically offered to students in high school and college. Student accounts are virtually the same as an adult account. Students can set up direct debit payments, pay for items online and in store, use their debit card to withdraw cash from ATMs and set up automatic payments. Generally, student bank accounts are completely free, meaning that students don’t have to pay to have a bank account. However, some student bank accounts will also offer an overdraft facility of up to $2000, depending on status, which students can use as a cushion if they run out of money for paying their bills. Overdrafts are generally free if you pay back any money owed on the overdraft within the month. If not, there is generally an interest charge of up to 30%. If you must use your overdraft facility, try to pay it back within the month, if you can.

Graduate Account

Graduate accounts are what students move onto when they graduate college. They have all of the benefits of a student account, including the ability to make and receive payments, the ability to withdraw money from an ATM and the ability to access an overdraft. The major difference between a student account and a graduate account is the amount of overdraft available. Typical graduate accounts could come with an overdraft of up to $4000, depending on status. The reason for the increase in overdraft on a graduate account is to give students a helping hand when it comes to paying their bills and finding a job when they are fresh out of college, although the interest rates typically remain the same.

Student bank accounts differ from bank to bank, so ask your local bank about anything you’re not sure of.

Tag: student account

What to Look for in a Student Bank Account

Guide to Student Bank Accounts