How to manage your student account
Written by Robert Bester, Consumer Finance Expert Robert has been a writer for six years, specialising in consumer finance and the UK lending market. Concentrating on consumer credit products, Robert writes informative articles that help customers manage their personal finances efficiently.
23rd November 2020
4 minute read
As a full-time student, it can be difficult to concentrate on anything apart from your course (and perhaps a hectic social calendar). However, at some point it’s worth dipping into the world of finance and making sure your student account is kept organised.
Managing your student account will mean you avoid things like extra fees, going over your balance and not having enough to pay for bills. Below we’ve put together a short guide on how to manage your student account, along with information on switching your account if you aren’t happy with your current provider.
Why do I need to manage my student account?
You need to be able to manage your student account so you don’t get into financial difficulty while you’re studying.
Let’s face it, your university course is far more important, but if you let your finances slide you can easily harm your chances of borrowing money in the future. This can include getting a car loan or even getting a mortgage on your first home.
It’s important to maintain your account so that major expenses can be paid on time and in full. This includes your course fees, monthly rent and resources such as textbooks and stationery. If you don’t keep money aside for these expenses and many others, you can easily accumulate late fees and additional charges related to overspending.
Top tips for managing your account
To make sure you can juggle both your course and your money, we’ve got a few hints and tips for keeping yourself organised:
- Create a budgeting spreadsheet – making a note of your major expenses every month will make it much easier to plan out your expenses and organise how much you can spend every week and month. Your spreadsheet should be broken down by month and take into account how frequently you receive a student loan payment or bursary payment, depending on your circumstances
- Set up reminders or alerts – reminding yourself prior to any large payments being taken from your account will keep you more mindful about your finances and hopefully allow you to avoid overspending. Try setting up calendar reminders on your smartphone or via your email provider to remind you a few days before any significant payments have to be made
- Put aside spending money – rather than have all of your money in one account and risk spending vital money for your rent or course fees, try to have a spending pot instead. This can be achieved by having a separate standard current account, or by having an account with a built-in savings feature, such as Revolut, Starling or Monzo
- Check your balance every day – the easiest way to check your balance frequently is to download the associated banking app that you can login to on your smartphone. Checking your balance frequently will keep you ahead of any deficits in your account on a monthly basis
- Make use of your student card – one of the biggest perks of being a student is getting discount off certain purchases. This comes in particularly handy when purchasing course-related items such as a computer, software or textbooks. The money you will save can be put to use elsewhere in your budget
- Choose a perk that you will use – when choosing a student account, it’s important that you choose one with a perk that you can make use of. For example, choosing an account with a free young person’s railcard when you don’t use the train might be a bit of a waste. Instead, choose a perk that will save you money during your course
Things to avoid with your account
Now that you know the best things to do with your student account, we can share some potential pitfalls of having a student account that you should try and avoid as much as possible:
- Avoid living in your overdraft – the problem with having an overdraft, despite it being free for students, is that it is money that isn’t yours, and will need to be repaid eventually
- Don’t graduate with an overdraft to repay – if you’re asking when your overdraft needs to be repaid, it is usually when you graduate. A bank will usually convert your account into a graduate account or even just a standard bank account. This means your overdraft will start to incur a fee on a daily basis. Instead, try to repay your overdraft with plenty of time to spare before graduation
- Don’t spend over your overdraft – going over your overdraft limit will incur additional fees until you can bring yourself back within your limit
- Avoid additional borrowing – if possible, you should avoid having to borrow any further money through credit cards or loans if possible, as this is another opportunity to incur further debt that can damage your credit score in the long term. However, credit cards can come in handy for protecting your purchases, as long as you can repay the full amount every month
Can I have more than one student account?
Most banks will stipulate that you can only have one student account, as a way of helping you avoid multiple overdrafts that need to be paid in full by the end of your course. However, that doesn’t stop you from applying for multiple accounts.
Be aware that each bank has its own terms and conditions for having multiple accounts and are within their rights to reject applications or even close your account or withdraw your overdraft if they see fit. Also, having multiple debts will have an affect on your credit score, which could sabotage your chances of getting accepted for credit in the future.
If in doubt, switch your student account
Thankfully, it is easier than ever to switch student accounts if you feel like you are with the wrong provider. By using the Current Account Switching Service (CASS) you can make the move within 7 working days. There is even the possibility of moving your overdraft over, as long as this is authorised by both providers.
If you’re thinking of switching to a new student account or would like to open one before you start university, take a look at our most popular accounts using the link below.