Aug 03, 2016— read in full
Banking & Insurance: the Essential Guide
What should I look for in a student bank account?
- Interest-free overdraft: An overdraft is permission from your bank to take out more money than you have in your account - so you might end up with a balance of -£100, for example. Normally, you have to pay interest on an overdraft, but on most student accounts the overdraft is free - though remember you have to pay it back!
- Freebies and discounts: Some banks give special offers with student accounts, such as discount cards, gift vouchers or free gifts. Weigh up how much these are worth - if you let a free MP3 player tempt you into a bank account that’s less suitable for you, you’ll probably lose out in the long run.
- Inclusive services: Your account might come with other services offered by the bank, such as free insurance cover for things like your mobile phone or laptop. This can save money and worry, but remember to check the details of you could be disappointed.
Most accounts come with a debit card and online banking.
What happens when I graduate?
Normally, your student account automatically becomes a normal current account once you graduate. You will probably keep some of the benefits - such as the interest-free overdraft - for a year afterwards, but check this with your bank. After this point, it might be time to shop around again to find the best deal.
How does insurance work, and do I need it?
Insurance is a way of guarding against losing your property to theft, fire or other events. You pay a monthly fee, and if one of the things covered by your insurance happens, you’ll be paid the money needed to replace your property.
Here are some kinds of insurance you might think about as a student:
- Contents insurance: covers the things in your home. Useful if you have expensive items like a computer, but make sure they’re covered as some things like musical instruments need special cover.
- At-risk cover: covers things you take outside your home, like your phone or jewellery.
- Car insurance: this is legally required if you drive a car, because it covers damage you might cause to other people. You can also pay more to cover fire, theft and other damage to your car.
- Health insurance: this covers the cost of private healthcare. Most people won’t need this, as healthcare is available free from the NHS.