UCAS - Student bank accounts

How to choose the right bank account

There are different bank accounts available so shop around to find the best deal to suit your needs, like an interest-free overdraft or online banking service. It's important to know which banks will be accessible to you when you're at university or college, so check that there's a branch on or near to your campus. Speak to banks to see if they offer the services you require or go to www.moneyfacts.co.uk which lists the current student offers from banks.

Look out for....

Interest-free overdrafts: one of the most useful things you can have as a student is an interest-free overdraft. If you become overdrawn, you will not be charged interest. This will save you money, as you should not then need to run up a bill on a credit card. But remember that it is a loan; you will have to pay it back after you graduate.

Graduate accounts: graduate accounts usually allow you to keep an interest-free overdraft for three years after you complete the course, which gradually decreases in size each year. The purpose of this is to ease you into only spending your available funds. You may also be offered discounts in certain stores for goods if your bank provides you with a Graduate Card.

Online banking: checking your account online can help you stick to your budget, because it can keep you up-to-date with your available funds and spending regime.

Be aware of....

Credit/store cards: although credit cards and store cards can be extremely useful when you are in a dire financial situation, they can be more trouble than they are worth. You can use a store card or credit card to pay for goods if you don't have access to funds, which you then pay off at the end of the month. If you cannot pay it back by the due date, you'll be charged interest, so what might seem like an easy fix may actually cause you more debt in the end.

Overdrafts: certain banks will offer authorised overdrafts, where they will charge you a certain amount of interest on an agreed amount borrowed. If you go over this limit, you are effectively spending money that the bank has not agreed to lend you and the interest charges for this can be very high.