Student accounts are just bank accounts for people in higher education, that often offer additional benefits such as interest-free overdrafts. We have compiled some top tips for how to search for the best options. However, you should choose the bank account that you find best and that suits your individual needs! Check out these tips on how to choose the best student bank account for your needs
What to consider when deciding on a student bank account:
- Try to look past the freebie. Most banks will use attention-grabbing freebies to try and entice students to choose them. Free items are tempting but if the product is something you wouldn’t have usually bought or don’t need then the savings might not be as great as you think. Also, if you tend to overspend on your student account, you may pay much more in penalty fees over the course of a year compared to the worth of the freebie. So be sure to check the overdraft terms and conditions and work out if it’s worth it!
- You don’t necessarily have to stick with one bank. Most students tend to stick with whatever bank they’re already with when choosing a student account, but that only makes sense if you're getting the best deal. If you're not, now is the time to look around and see what else is out there.
- If you’re unsure which bank to go with, don't be afraid to go into the bank and ask to talk to an advisor. Although the internet is great for getting overall information sometimes it is helpful to go in and talk to someone in person about the details.
- Check to see if there is a branch near your accommodation or the university. Even though you probably won't need to go to the bank very often, it’s helpful to have a branch close by in case you do.
- For further tips check out Money Saving Expert:
While credit may seem like a good idea, it is debt and will cost you more in the long run. If you need to use credit, shop around carefully for the best deal and make sure you read the small print before signing anything. Credit agreements are legally binding and generally more expensive than overdrafts.Credit agreements are legally binding.
Payday loans may look appealing but you have to be aware of the often huge amount of interest you will be paying back. These loans can also affect your future credit rating which will be taken into account should you apply for a bank loan or mortgage.
If you use a credit card, you must keep up your monthly payments. Missed or late payments will mean paying a lot of interest and may affect your future credit rating. Credit information about you is kept on file. Other companies and banks can see it when you apply to them for cards, mortgages, loans and so on.
If you are having problems making monthly payments, it is important that you try to solve the problem as soon as possible. You can contact the lender and explain - they may reduce your payments for a while - or you can contact one of our Student Funding Advisers for advice. The problem won't go away if you ignore it. Asking for advice is the first step to managing the situation.
Nobody has to give you credit or a reason for refusing you, however, many lenders get information about your from credit reference agencies (CRAs). You have a right to ask a CRA for a copy of any information they have about you although there may be a small charge for this. You can get it by writing to each agency direct, or by downloading an application form from their website. If there are any mistakes on your entry you can have them corrected.
You can contact:
You may eventually need a good credit score, if you ever plan on applying for a mortgage/credit card/similar loan.
When considering whether or not to lend to you, lenders (such as banks/credit card companies/etc.) will look at your credit score to decide whether or not you are a trustworthy debtor, who will pay back the loan.
However, there is no one definitive credit score, there are 3 credit reference agencies in the UK (Equifax, Experian & TransUnion) who have their own criteria to make up their own credit score for you.
This is judged from a number of factors such as your ability to afford repayments, your repayment history from previous credit products and the amount of debt you currently hold (not including your student loan).
The higher your credit score, the more likely you are to be successful in any credit/loan/mortgage application, qualify for lower interest rates and be offered higher credit limits.
How to improve your credit score:
- Register as a voter
- Don’t apply for lots of credit cards/loans at the same time
- If you already have a credit card, use a maximum of 30% of the card’s monthly limit
- Pay your bills on time
- Pay off any debts/loans in full each month
There are things you can do to avoid getting into debt as a student.
- Remember that the student loan has to last you 12 months except in your final year, so make sure you budget for the summer months
- Credit cards may seem like a good idea at the time, but the debt soon builds up – even with the best of intentions! If necessary, get only one, and at the very least make sure you make the minimum monthly payment.
What to do if you get into debt
First of all, if you get into debt
- If you have multiple debts) prioritise the debt with the highest interest rate, not the highest amount.
- witch to a 0% transfer card to give you a limited period of time to pay of the debt without the extra interest payment (it may be the case that you aren’t always eligible for one but there is no harm in finding out through any comparison site of your choice).
- Seek advice
There are different ways you can get advice:
Further advice and practical help:
Support from the Glasgow North West Citizen’s Advice Bureau: This local branch now offers direct, specialised advice in areas of Practical welfare including Housing/tenancy issues, Welfare benefits, Debt advice and Tax.
Please email bureau@gnwcab.org.uk to access the service and someone from CAB will contact you directly to offer confidential advice via email, phone or face to face. You can also contact your local Citizens Advice Scotland directly.
Other debt advice charities:
A credit union is a financial co-operative which provides savings, loans and a range of services to its members. Credit unions are owned and controlled by its own members and not by external shareholders or investors, so the emphasis is always on providing the best service to its members.
All credit unions offer savings accounts and loans. Many offer a wide choice of additional products such as junior savings accounts, Christmas savings accounts, prepaid debit cards, insurance products, cash ISAs and in some cases even mortgages.
