Current accounts are designed for your everyday money needs in mind and the right account will depend on you and your requirements. You should ask yourself whether you are usually in credit, if you are often overdrawn, whether you need 24 hour a day banking and if you are interested in extras such as travel insurance and breakdown cover. There are special accounts designed for students with exclusive offers geared specifically towards students such as interest free overdraft facilities and free railcards. Some current accounts come with a range of additional benefits, such as types of insurance for a monthly fee. You may also be given discounts for other services, for example sending money abroad. Many bank accounts offer incentives with their accounts such as free gifts and vouchers but do not just be drawn in by these. Without these does the account still offer everything you are looking for?
The market for current accounts is competitive because they are such popular products. With so many vying for your business you should research thoroughly to find the best deal for you. There are hundreds of accounts to choose from. You should think about the things you’ll be using the account for. You may want to choose an account that can be managed online or via the phone and whether it has a 24 customer service line. Age restrictions may apply, you can usually open an account quite young but you may not have full access to all the benefits. Please note that you will have to provide some identification to open a current account which can include a passport, and proof of your address such as a bill. You may also find that you need to pay in a minimum amount each month to qualify for certain features such as particular interest rates.
Some current accounts come with an overdraft facility which is essentially borrowing money from the account provider. If you exceed the available balance in your account and go into a negative balance, then you enter your overdraft. Some accounts may offer overdrafts on an interest free basis. However, you should watch out for charges as some banks may charge you for this facility and rates can vary. If you do not have an overdraft facility and you go into a negative balance you should expect these fees to be much more expensive. Don’t spend money you don’t have in your account without arranging an overdraft. You need to make sure you do not go beyond your overdraft limit or you will face costly charges which can easily mount up.
What you need to know:
- When choosing a current account think about the type of account you need, whether you are offered an overdraft facility and how much it will cost and if there is not overdraft how much it will cost to go overdrawn.
- To avoid charges you should know how much money you have in your bank account, keeping an eye on all what is coming in and all your outgoings.
- Watch out for any hidden charges with some account providers. You could be charged for duplicate statements, banker’s references, status enquiries and access to money or services abroad.
- Don’t be afraid to switch current accounts if the charges are too high or you don’t think you are getting a good deal. Most people tend to stay with the same bank but by switching accounts you could get access to better rates and offers. Switching your current account is simple nowadays.
Looking to save money for the future?Saving money for the future is becoming more and more important for people in the UK. If you want to put money aside then a savings account is where you can safely put your money, where it will earn interest over time. Savings accounts are a really easy way of growing your personal fortune and there is little risk involved. People put money away for any number of reasons: It could be that you want to save for something in particular like a house, car, a holiday or wedding, your children’s future, or it could be that you want to put some money aside so you are covered should anything unexpected happen like you lose your job or need to pay for emergency home or car repairs. Savings accounts are a great way of saving for the future and being prepared for any unexpected emergencies.