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Best student bank accounts
*All information in this blog is correct as of 30/06/2020*
The next academic year is just around the corner, and if you’re preparing for your first year at university, you’re probably working your way through a long to-do list.
One of the most important things to make sure you have sorted before arriving in your chosen city is opening a student bank account.
Not only will you need a current account to manage your student loan and any rent payments you plan to make, but there are plenty of things you can benefit from by making sure you tell your bank that you want a student-specific account.
Firstly, what are the benefits of a student account?
A student bank account is designed specifically for students, and so it should answer to all your needs. It can be difficult at first getting to grips with managing your finances for what is probably the first time in your life, but choosing the right account can help you learn to do that efficiently.
There are often lots of incentives on offer when opening a student bank account, including railcards and £50 vouchers, but reading the fine print is the most important thing because an interest-free overdraft will be more beneficial in the long run than an Amazon voucher.
So what will you need to open a student account?
Proof of student status – this will be a letter of acceptance from your chosen university, or a letter from UCAS outlining your offer.
Form of photo ID – you may need up to two forms of photographic ID, which might be a driver’s license or a passport.
Proof of address – this might be a bill addressed to you, or a bank statement.
What bank should you go with?
We checked online in June 2020, and here are some of the benefits you can expect from some of the big providers at the time of publishing:
Santander
– Interest-free overdraft of £1,500 in your first three years (this increases in year 4)
– Free four-year 16-25 railcard
– Interest payments to you on your current account balance
– Cashback offers on purchases
Royal Bank of Scotland
– Interest-free overdraft up to £2,000 (£500 in the first term)
– Offers: Amazon Prime Student membership, National Express Coachcard, or a Tastecard
Halifax
– Interest-free overdraft up to £1,500 for the length of your course, plus an extra year after graduation
– Cashback offers on purchases
– Interest payments to you on your current account balance
Barclays
– Interest-free overdraft of up to £500, which can be increased in your third year
– Cashback offers
HSBC
– Arranged overdraft of up to £3,000
Lloyds
– Interest-free overdraft of up to £1,500, which can be increased in years 4-6 of your studies
Nationwide
– Interest-free overdraft of £1,000, increased to £2,000 in your second year, increased to £3,000 in your third year
TSB
– Interest-free overdraft of up to £1,500
Top tips for managing your money
It can be difficult trying to budget when you receive your student loan in big chunks, or when you have access to large amounts of credit, but getting into good habits early on will set you up well to enjoy your time at university.
Tip 1 – download online banking so you can always keep an eye on your incomings and outgoings and adjust your spending as necessary.
Tip 2 – work out how much money you have remaining from your student loan and any other income after any commitments have been debited (e.g. rent payments, bills, memberships). Once you know how much you have left for the rest of the term, work out a budget by dividing it by the number of weeks it needs to last.
Tip 3 – keep an eye on bank offerings across the time you’re at university. Just because you opened your account with one provider and received an incentive, it doesn’t mean that you’re not entitled to swap to a different bank that may suit your needs more a few months down the line.
Tip 4 – once you are no longer a student, make sure you lookout for the best graduate accounts as many will still give you some of the benefits that you enjoyed as a student.
Please note that Nurtur Student Living is not an expert and has written this article as an advisory piece only. For expert advice, please ensure you speak directly with the bank of your choice who will be able to provide impartial advice.
*All information in this blog is correct as of 30/06/2020*
Written by the Nurtur team