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!