Tag Archives: bank accounts

Student Finance: BBC Radio 4 Money Box Live

16 Sep

Good morning campers!

How are we all?

We have a treat for you today, not one but two posts are coming your way!!  The usual Thursday scoop of Delectable Discounts will arrive later on this afternoon but first we have to point out a great radio programme that aired yesterday afternoon on BBC Radio 4.

Money Box Live is a phone-in programme hosted by Paul Lewis and looks at different financial issues every week.  About this time every year, they have a student finance special. Yesterday it was the hot topic and they had representatives from Student Finance England, Kingston University, Student Finance in Scotland and the NUS.

It proved to be an interesting listen, of course there were plenty of worried students and parents phoning in to talk to the SFE rep.  There was some good advice given and good points raised.

If you’ve got time over the next few days, we would recommend listening to the show.  It is available on BBC iPlayer to listen again.

Enjoy!

CSM

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Student Loans saga

5 Sep

There hasn’t been a September for several years that has seen nothing in the media about the student loan scheme.  Every year something seems to go wrong, whether it is applications not being processed quickly, applications being given the wrong funding or worse of all, no funding turning up at all.

This year is no different.  Once again, there are thousands of students who have received wrong or no information about their student loans.  First year students whose parents have submitted financial information, only to be told that Student Finance England (the main culprits of the mistakes it seems) don’t have any record of the information being sent.  Returning students have had loans cut by over £1000 because details haven’t been processed, and generally all students are left with a uneasy feeling and no confidence that the money will be paid on time if at all.

The latest press release from Student Finance England reads as follows:

“STUDENT FINANCE ENGLAND APPLICATION PROGRESS UPDATE – 30 AUGUST 2010

We would like to assure students that processing at Student Finance England is going well this year. There have been some reports in the media claiming that large numbers of students will not receive their funding at the start of term. We would urge the media and public to refer to our official statistics, which shows that this is not the case:

The latest statistics are from 26 August and will be updated every fortnight.

The statistics show that we have processed the majority of applications and they are ready for payment once students register at university.

We have put in place a process to ensure that even students applying just before the start of term can get the majority of their money. These students must apply online, prove their eligibility with their passport number, return their signed declaration form, and then register and attend university.

For further information please contact the Student Loans Company press office: 0141 306 2120.”

The statistics say that of 877,000 live application for student finance for the year 2010/2011, 71% (877,000) have been cleared and processed for payment.  Another 25% (218,000)  are ‘awaiting further evidence or signature from the applicant’ and then they quote 5% (40,000) of the applications are ‘currently with Student Finance England’.

As direct quotes from the statistics they have released, you’ll be as amused as us to notice that adds up to 101%.  Good omen? We don’t think so.

However, for 30% of the students who have applied for student finance, the applications have not been processed fully.  Without data about when these applications were made, we can’t comment fully on the productivity or competence of Student Finance England.  We don’t think it looks good that 2 weeks before most Freshers will be moving into their new University Accommodation, nearly a third of students don’t have guaranteed funding.

It’s bad enough that the current generation of students are coming out of University with around £21,000 in debt.  Couldn’t the government at least get a system that allowed the process to be significantly less stressful and definitely less time consuming?

We are really interested in researching the 2010 application delays further.  Please let us know your experiences at the email address: savvystudent@gmx.com or leave a comment on this blog.

The next press release from Student Finance England is due on the 9th December, with statistics to be valid as of 2nd September.  We will be watching with interest.

Hope you’re all enjoying a cosy weekend!

Love

CSM

The dreaded student bank account hunt: Part 2.

1 Sep

Right, time for Part 2 of the student bank account saga.

In Part 1, we talked about what banks have to offer students and now it is time to get down to the nitty gritty facts and figures.

Skip to the bottom of this post to see our round-up of the best student accounts at the moment.

So there are nine high street banks who offer student bank accounts.
These are (in alphabetical order just to be fair!):
Barclays
Co-operative
Halifax
HSBC
Lloyds TSB
Natwest
RBS
Santander
Smile

We shall briefly outline the first year overdraft limits, how much the overdraft can rise to, interest rates, what freebies are on offer and where you can find out more information. Unless otherwise stated, all of the accounts require you to be a student studying for a degree or equivalent course. Most require you to be over 18, but a couple say 17 and a half. It’s really important to check how much the bank expects you to deposit and whether they need to see proof from UCAS. All that information is easily accessible via the links provided below.

Here we go!

Barclays:
Account name: Student Additions
First year interest free overdraft limit: Initially £200, can be increased.
Maximum interest free overdraft: up to £2000
In-credit interest rate: 0% (*we keep our promises – see glossary for interest rates/AER definition).
Interest on overdrafts over the 0% limit: 8.9%
Any freebies available?: Offers with Phones 4 U.
More information please!

Co-operative:
Account name: Student Account
First year interest free overdraft limit: £1400
Maximum interest free overdraft: £2000
In-credit interest rate: 0%
Interest on overdrafts over the 0% limit: 9.9%
Any freebies available?: None
More information please!

Halifax:
Account name: Student Current Account
First year interest free overdraft limit: £500 initially, more can be requested.
Maximum interest free overdraft: £3000
In-credit interest rate: 0.1%
Interest on overdrafts over the 0% limit: 7.2%
Any freebies available?: 25% discount with the AA, 20% discount with their card care insurance scheme.
More information please!

HSBC:
Account name: Student Bank Account
First year interest free overdraft limit: £1000
Maximum interest free overdraft: £1500 for 3 year degrees, £2000 for 5 years.
In-credit interest rate: 2% on balances up to £1000 (first year only), 0% on all other balances.
Interest on overdrafts over the 0% limit: HSBC base rate plus 3%
Any freebies available?: Two years worldwide travel insurance. Free TalkTalk sim card.
More information please!

Lloyds TSB:
Account name: Student Account
First year interest free overdraft limit: £1500 tiered through first year
Maximum interest free overdraft: £2000
In-credit interest rate: 0.1%
Interest on overdrafts over the 0% limit: 8.2%
Any freebies available?: NUS extra card for 3 years, NYA membership for 3 years. 40 free music downloads plus free mini speaker.
More information please!

Natwest:
Account name: Student Account
First year interest free overdraft limit: £1000 tiered by term
Maximum interest free overdraft: £1500 for 3 year degrees, £2,000 for 5 years.
In-credit interest rate: 0.1%
Interest on overdrafts over the 0% limit: 17.81% plus £5 per unpaid item.
Any freebies available?: 5 year young person’s railcard. Student discount card. £100 off ASUS laptop.
More information please!

Royal Bank of Scotland:
Account name: Student Royalties
First year interest free overdraft limit: £1000 tiered over 3 terms.
Maximum interest free overdraft: £1500 for 3 year degrees, £2000 for 5 years.
In-credit interest rate: 0% from 22 September
Interest on overdrafts over the 0% limit: 17.81% plus £5 per unpaid item.
Any freebies available?: Scottish students: travel package including 3 year Young Person’s railcard and 4 weeks free bus travel. Student discount card and £100 off Asus laptops. English and Welsh students: Student discount card and £100 off Asus laptops.
More information please!

Santander:
Account name: Student Current Account
First year interest free overdraft limit: £1,000
Maximum interest free overdraft: £1500 for 3 year degrees, £2000 for 5 years.
In-credit interest rate: 2% on balances up to £500, no interest paid on balances above £500
Interest on overdrafts over the 0% limit: 9.9%
Any freebies available?: 3 years of insurance for customer’s laptop, mobile phones and gadgets.
More information please!

Smile:
Account name: Student Account
First year interest free overdraft limit: £1000
Maximum interest free overdraft: £2000
In-credit interest rate: 0.12%
Interest on overdrafts over the 0% limit: 15.9% plus £30 per unpaid item.
Any freebies available?: None
More information please!

Wow, so that’s a lot of information for you to digest.

We’ve had a good browse and put together a few ‘best for…’ suggestions:

Best for…students who need the overdraft:
Halifax with up to £3000 overdraft.

Best for…students who will stay ‘in the black’:
HSBC for the first year at 2% for balances up to £1000…reassess after your first year. If you don’t want to have to change, then Smile at 0.12% is the best for you.

It may be worthwhile looking at standard current accounts if you are not going to need the interest free overdrafts found on student accounts. However, be warned that if you find yourself needing an overdraft on a ‘normal’ account, that the interest rates can be very high.

Best for…freebies:
On face value – Natwest’s railcard offer is still the best (valued at £130). Many students already have these though, so consider using the discounts or insurance offered by other banks if you do.

Hopefully this blog has helped to explain a the accounts that are on offer for you.

For explanations of interest rates, AER and some of the other technical jargon – have a peek at our glossary.

Don’t forget to let us know which bank account you chose and why!

The dreaded student bank account hunt: Part 1.

1 Sep

It is that wonderful time of year again – September, University students across the country are stirring from their summer slumber and remembering where their text books are. Meanwhile, a whole bunch of fresh faced young new blood are buying saucepans and bed covers whilst Mum panics about whether they can feed themselves. Of course, whilst priorities differ between students and parents, one thing that is usually always high on both lists is a student bank account.

There are several options out there on the high street with each one having its own set of pros and cons.

We are going to introduce you to a few of them and hopefully help you work out which is the best account for you.

This is going to be a two-part blog entry so that we don’t baffle your brains too much. If you just want to know about the bank accounts then head to Part 2, where each of the 9 High Street banks that offer student accounts are profiled.

Back to Part 1…

Before we dive into naming banks and talking numbers, it’s worthwhile us outlining the different features of a student bank account and how they work.

Why do banks bother with students?

Banks know a few things about students and why they are beneficial to have on the books. Students are going to gain a degree, therefore generally are going to earn more than their peers who don’t have a degree. Most people don’t like faffing about with changing bank accounts as it takes a lot of organisation and hassle. Therefore, banks know if they can hook students in early, they will probably hold on to them when that student becomes a young professional. They also know that most students will end up having some sort of overdraft that as soon as they graduate, the bank can start charging interest on. Money in their pocket!

What do the banks offer?

The first thing that you usually see when you hit a bank’s website is the freebies they are offering…this year it ranges from railcards, mobile and laptop insurance to travel insurance and ‘exclusive’ discounts. Some of these are genuinely going to be useful but it is important to look beyond these and have a proper look at the account underneath. If you look at the freebies as a way to discern between two similar accounts, then you will probably get a better deal than just jumping at the first offer that seems attractive.

Probably the most important feature of a student bank account is the overdraft. Nine high street banks offer student accounts with an interest-free overdraft which has a variable limit (usually dependent on your year of study but may also depend on a credit check).

The amount of overdrafts offered vary from £500 in your first year through to £3000 in your final year. Check out part 2 to see what is offered bank to bank.

If you are the rare breed of student that is mostly or always going to be in the black, then it is worth looking at the interest offered on your positive balance. Again, varying from bank to bank and profiled in Part 2.

Of course, this isn’t just for new students, it can be beneficial for existing students to switch too. Talk to your bank, they are surprisingly helpful and many even offer free financial advice for students.

It needn’t be as scary as it seems!

Part 2 of this blog is coming up…exactly what do the banks offer?

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