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Compare Current Accounts with Money Pug
What Do I Need To Consider Before Choosing a Current Account?
- How much do you anticipate putting into and taking out of your current account each month?
- Will you need an overdraft on the account?
- Do you regularly need to move money between accounts?
- Are there any extra features that you would like on your current account?
What Current Account Types are Available?
Standard Bank Accounts
Standard bank accounts are often known as current accounts and these are flexible and multi-purpose accounts that are held my most people in the UK. These are the standard accounts into which you can have your salary paid. These accounts also allow you to conduct all your everyday household business, such as paying bills and setting up direct debits. These accounts will usually have a debit card, which will allow you to pay for items and make cash withdrawals.
To try to encourage consumers to choose their option, banks and building societies will often provide packaged account deals. In such cases, a standard account is paired with additional extras. These extras often include things like travel insurance, mobile phone insurance, breakdown cover or cashback on purchases. While these packaged accounts can be worth looking in to, they will come with a monthly or annual fees, so it is important to check that they actually will save you money. Weigh up all the benefits and make sure than a packaged account really would work for you.
If you are a student then it is definitely worthwhile getting a specific student account. These current accounts for students are geared towards your needs. They often come with handy features such as interest-free overdrafts and other added extras that can make these accounts a worthwhile option for those who are at college or university.
Once your student days are over, you may wish to look into getting a specific graduate account. These accounts are specifically designed for those who have finished a university degree and often offer excellent introductory rates including things like 0% overdraft fees for three years and free day to day banking with online and mobile banking options. A graduate account can often also give additional preferential access to other financial products such as personal loans.
Basic Bank Accounts
If you have a poor credit rating or are new to the country, you may find it difficult to get a standard bank account. You will, however, be able to get a basic bank account into which you will be able to deposit your money and withdraw it. There will be no overdraft facility and these really are a basic option, but anyone can get one of these basic bank accounts so this is a place to turn if you’ve had problems being accepted for a different kind of account.
What Factors are Important When Choosing a Current Account?
Interest Rates (AER)
The Annual Equivalent Rate (AER) is the variable interest rate on your account when your balance is in credit. This shows how much interest you will get at the end of the year. It is worthwhile considering this figure, as it will often be best to choose the account with the best saving rate.
The account fee is the amount that you will have to pay each year in order to hold a certain account. There is usually no fee for a standard bank account, though packaged accounts do often have a charge and you should think about whether the added extras offered make it worthwhile to pay this fee.
It is also important to note whether or not the account you are looking at has an overdraft facility, and if it does, how much you will be charged if you find yourself overdrawn. Certain accounts are more generous than others when it comes to their overdraft policy. If you regularly find yourself overdrawn at the end of the month then it is definitely very important to pay close attention to any related charges that you may incur and to choose a current account with a more lenient and generous overdraft policy.
Current Accounts FAQs
- In the UK, everyone over the age of 16 who is a legal British resident can get some form of current account (though it may only be a basic one). Some banks may only provide bank accounts to those who are over 18, while others may require your parents to sign off if you are a teenager. You need to be able to prove who you are and should bring ID with you to open an account, as well as evidence of your current address. Some banks might also insist that you pay in a minimum amount each month. If you cannot do this, or your credit rating is bad, you will still be able to get a basic bank account.
Should I Get a Joint Account?
In addition to opening a sole current account, you can also look into and compare joint current accounts, which can be held in common with a partner, or with (for example) student housemates who wish to make deposits into a communal account to pay the household bills. While a joint account can be useful for those with financial interests in common, it is important to trust those with whom you wish to share a joint account, as any account holder will be able to withdraw funds from a current account at any time.