Fresh college students, opening a bank account and preparing for their finances are the least of their worries. However, financial prep is an important step when starting college and moving forward with life.
Here are 5 things students should consider when opening a bank account.
Opt for the Large Student Overdraft
While you might not be sold on the full overdraft, take the opportunity to apply for it as this will help increase the amount in your savings account. In fact, you will make more money due to the interest build up. While you will not become an instant millionaire, you will still earn a great return.
Beware of the So-Called Freebies
Banks always have something to offer students. But don’t be tricked into their freebies. These so-called freebies are usually short-term offers that include free products, insurance, cash back rewards, and other things that might interest students. Go for a large interest-free overdraft for better benefits.
Ask About the Overdraft Limit
One of the most common ways to borrow money is by arranging an overdraft. Use this time to take advantage of your 0% interest rate as a student. An overdraft free will mean that you pay only what you owe and nothing more.
Understand the Conditions of Payment Fees
Did you know that over 65% students that were surveyed did not know when they were supposed to pay off their overdraft? While this Is not expected to be paid until after graduation, the late charges will cost as much as $3,000.
Check Up On Your Credit Rate
Understand the credit rating and how it works. This is vital as it will be used for all future loans, housing, and major purchases you will make in the near future. The bank will base your overdraft on your credit score.
It is important to consider the location and convenience of your bank. While this isn’t a primary concern, you should choose a bank that is accessible and easy to visit. This will also help prevent any penalty fees during an overdraft.