how to choose a student bank account

A guide to student bank accounts and their perks

Applying to university comes with making a lot of other decisions. All of them seem small, but could actually really impact your life both as a student and afterwards. One such decision being whether or not to open a student bank account, and which bank to open an account with. So we’re here to help you decide which student bank account is best, and talk you through how to choose a student bank account!

student bank accounts
Source: Times Higher Education

How to choose a student bank account 

Compare overdrafts 

Many student accounts have interest-free arranged overdrafts. This means that you can borrow money from the bank without incurring interest on what you borrow. So if you use up your maintenance loan, you can still afford to do that food shop. You pay it back after you graduate, but until then it is a reassuring safety net whilst you’re at university.

Different bank accounts have different overdrafts available to students. Some increase each year, some increase after graduation, and some you can visit the bank branch and request to increase the overdraft. So depending on your situation (i.e whether you’re hoping to work, how much loan you’re getting, whether you have savings) will depend on which account suits you the best.

Compare perks 

As well as free overdrafts, student bank accounts usually offer some kind of incentive to get you to sign up with them. These can be vouchers, railcards, subscriptions to useful services like Perlego. If you’re going to be doing a lot of travelling via train, maybe consider that when you go to choose your student bank account.

Look at how useful the mobile banking app is 

The likeliness is that you’ll be relying on mobile banking for most of your bank-related needs during university. It’s the easiest way to pay someone back for the kebabs at the end of the night out, or to start saving, or to check that your student loan has come in; so if the mobile banking app isn’t working or has a tendency to crash, it’s not ideal.

See if there’s a branch near your campus or accommodation

Whilst you’re not going to need it very often, if you do need to pop into the bank for whatever reason, it would be useful to have a branch near you. So if the only bank in your new city is HSBC, maybe don’t opt for Lloyds TSB. Makes sense, right?

Look at what happens after you graduate 

As we said before, things like your student overdraft will change. Usually you get a year or two of a Graduate Current Account rather than a student one, and then it will develop into a usual current account. In the period in the middle, it is expected that you start working to pay back your overdraft

What student accounts are out there? 

Based on student reviews, we’ve summarised the top 5 student bank accounts for you. There are, of course, others, however these are the accounts with which students have reported the most satisfaction!

HSBC Student Bank Account 

HSBC student account
Source: HSBC

Overdraft: Up to £3,000

Incentive: £80 cash + £20 Uber Eats or ASOS premier

In first year, your overdraft will be up to £1,000. This could rise to £3,000 by your third year. You must be over 18, a resident of the UK, Channel Island or Isle of Man for 3 years+ and be currently living in the UK.

Santander 123 Student Account 

santander student accountant
Source: The Drum

Overdraft: Up to £2,000

Incentive:  Free 4 year 16-25 Railcard (worth £100)

In your first 3 years, you will have access to a £1,500 overdraft so long as you put £500 into your bank each term. After you graduate, or if you go into 4th year, this will increase to £1,800 for 4th year or £2,000 for graduates. If you continue to 5th year, it will then increase to £2,000. As an incentive, you get a free railcard which will provide you 1/3 off all train travel within the UK.

Nationwide FlexStudent Account 

Nationwide student account
Source: Irish FA

Overdraft: Up to £3,000

Incentive: n/a

Whilst Nationwide have one of the most generous overdrafts, and one which any student accepted to the account is guaranteed to, they have no incentive.

NatWest Student Current Account 

NatWest student accounts
Source: FutureBrand

Overdraft: Up to £2,000

Incentive: £50 cash and a 4 year tastecard

NatWest’s student account offers you an overdraft of £500 in your first term, then up to £2,000 in your second term. To be eligible for the incentives you must register for online or mobile banking and switch to paperless statements within 30 days of opening the account.

Barclays Student Additions Account

Barclays student account
Source: Premier League

Overdraft: Up to £1,500

Incentives: 12-month subscription to Perlego

When you open your account, you will get a £500 overdraft, and you’ll have to ask to increase it past that point. This will depend on your credit score. In second year it will automatically go up to £1,500. As a sign-up treat, Barclays offer a year long subscription to the book-lending service Perlego.

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