card guide
Student and Young Person’s Bank Accounts

Start at the beginning

Getting children to be interested in and understanding how to live with money is something they won’t usually learn at school. The earlier you can get them used to having a bank account the more able they will be to look after their money when they finally leave your protective influence and have to cope on their own. So what’s available to them when they do want to open a bank account?


Usually the only sort of account that young children have in their names is a savings account that you as a parent or guardian may have opened for them. This will be a fund that is usually just left there until the child grows old enough to be responsible for it. If the child is lucky the account will have gathered some money from distant aunts and uncles at Christmas or birthdays and maybe sometimes it will have had small sums regularly deposited from you in an attempt to save for the child’s future.

Let them have it

Sometimes, if that account only contains several hundred pounds, (rather than a few thousand), it’s a good idea to let the child have access to the money when they are in their teens.

But be warned, you can lay down as many rules as you like about how you expect the money to remain in the account and you can lecture them until you are blue in the face about the benefits of compound interest, but once they have access to the funds you might as well wave the money goodbye and start building more shelves for computer games or DVDs in their rooms.

It may be disappointing that your offspring appears not to have listened to a single world of any of the intensive lectures you have given them over the years about how to handle money, but the fact is, once they have spent all that money in the account they will have got it out of their system and realise that once it’s gone, it’s gone. So hopefully when they become a student they will have more of an idea about how to look after the money they will then need to survive on.

Young person

A young person’s bank account usually offers a cash card so that money can be withdrawn from a Cash point machine, but they won’t provide overdrafts and they don’t provide cheque books. This banking is very much look after the money that you have because we aren’t going to give you anymore; an ideal teaching method for young people. Quite often these accounts also boast quite high deposit interest rates compared to their grown up counterparts.


There comes a time in every person’s life when you either are a student, or you know one. If you are a student it’s great. If you just know one, then you wonder why you’re paying your taxes to send this ‘nimno’ through further education. These days, of course, you can rest content that not so much of your tax is being spent on this person’s education as they no longer receive grants.

Overdrafts and interest rates

As a student, you will have to have a bank account in order to efficiently manage your student loan. There are a number of banks offering student accounts; many of them will try to tempt you in with goodies like free mobile phones. But really you need to be looking at the bottom line and try to get a bank account with the lowest interest rate on the largest overdraft you can get. You are going to use that overdraft at some point, even if you don’t plan to when you start out.

Your overdraft will be limited to about £1,000 in the first year. This will rise to roughly £1,400 in the second and increase until your final year. Don’t be misguided though in thinking that you get an additional £1,400 in the second year – it’s not that, the additional overdraft is actually only the £400. And this is not free money. You will have to pay back the debt at some point, when you start work.

So use your overdraft wisely: just as your mother taught you!

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Posted on: [ November 03, 2017 ]       Add to   Digg it   Add to Blinklist   Add to FUrl   StumbleUpon