Open A Bank Account and Save Money
This very complex subject is covered extensively on this site, and below all the sections that are available are listed below under Related Money Pages. Our pages must be read and taken in conjunction with what is happening in the banking sector at the present time. No matter if you are out in the wide, wide world earning your crust, or still at University or College don't struggle with your finances, the information is here on these pages, particularly at the start of the operation - when you open a bank account. One thing that applies in every situation is check your monthly statements. Stating the blindingly obvious - maybe - but it is amazing the number of people who just look at the final figure and then toss their statements to one side. 'Yes' - banks do make mistakes, and 'Yes', you really should look after your money.
Also please refer to the Property Section and Mortgages for specific information on these subjects. WHERE WILL YOU SAVE YOUR MONEY? Many people find their eyes glazing over at what they call this boring subject. This is where you can save yourself a mint. The following tips will help you. Change the home for your money. It is possible to at least double the interest you receive on your accounts. So - take good advice - open a bank account - maybe a new one. A First Direct account can be combined with a HSBC account and the use over-the-counter as well as telephone and on-line facilitie. To transfer your money around just use the (free) convenience of BACS transfers. When you open a bank account this will be explained to you by the staff if you are unsure. TIME LIMITED SPECIAL OFFERS Periodically there are ‘special offers’ that are designed to attract new customers. Exercise caution on all offers as often they are not so beneficial as they would appear to be at first sight. TV advertising can also be not quite what it seems. The highly expensive Halfax campaign showing a bank employee climbing to deliver a £5 note by hand, is a case in point. You will need to keep £1,000 in your account just to achieve this £5 interest.
It will pay you to hold your cash in more than one account (if you are fortunate enough to have more then £35,000 savings. This figure is the amount by law, that is guaranteed to be paid to you in compensation if a bank collapses. It was recently announced by the Chancellor of the Exchequer, Mr. Darling, that this figure of £35,000 would be increased to £100,000, but then a few days later this promise was quietly withdrawn. is to be increased to £50,000 One important point to bear in mind is that this figure is covered by the Bank's License. For instance, HSBC owns another bank i.e. First Direct, then this Banking License covers both banks, and therefore if you have £50,000 invested in both banks, you will only receive compensation on one amount of £50,000. Many people, particularly the older generation, speak in awe of these banking organisations and building societies when the open a bank account. Don’t make their task easier by accepting their low rates of interest. Shop around. These organisations will make more than enough in profits every year, so make sure some of it comes to you via the interest rates. With the Bank Rate at its present low point shopping around is well worth your consideration. It is still possible to obtain a reasonably good rate if you search around. One such organisation is the Dutch Bank - Ingdirect that is offering 4% interest on a Saver Account at time of writing when you open a bank account with them. The sad fact is that people often get divorced more times than they move their account. Learn to be a ‘rate tart’ and invest where you receive the best rate of interest. A Bank Manager recently told the author that banks loathe 'rate tarts', which proves that by becoming one you are getting things right. So just move your money around - open a bank account with one major bank and close the other. Move your account. This is now an easy task as your new banker will be only too pleased to arrange the transfer of your Direct Debits and Standing Orders. They are keen to secure your business. Go for it. OVERDRAFT CHARGES When you open a bank account think - will you need an overdraft ? What is the limit and perhaps most important of all, what charges will your bank levy if you exceed the designated amount? As stated in the next item, bank customers are nearer to getting a refund on past overdraft charges they have paid. Overdraft charges vary from bank to bank, with Abbey at the moment at the top charging £60.12 penalty for a £200 unauthorised overdraft for one day and Alliance and Leicester at the bottom (if it can be called that)with £30.15 being charged. Check these rates as they are continually changing. If you hold an account with HBOS you should be aware that they are reviewing their overdraft charges. In future they will charge £1 per day (every day) even if you are overdrawn by only 1p. According to the MoneyBox programme 24.11.2009, investors are withdrawing their accounts at an alarming rate. If you are with any bank with high overdraft charges it seems imperative for you to open a bank account elsewhere. 'FREE' CURRENT ACCOUNTS Recently it had been thought that some bank customers could now be in line for a massive £lbn. refund after a recent significant decision in the High Court over unfair charges. A judge ruled that fees for exceeding overdraft limits and bouncing cheques were subject to 'unfair contract' regulations. Following this decision it had been hoped for a change in the way overdraft fees are collected. This is no longer the case, and it would appear that the only way customers can stand any chance of recouping any of the charges levied against them is via a private prosecution. This is not good news. Some banks. such as First Direct are already paying no interest at all on current accounts. Other banks are charging customers up to £25 per month for running their current account, offering incentives that they do not need. Amongst these are Lloyds TSB Premier, Yorkshire Bank Current Account DTracker and Clydesdale Bank Current Account. This is according to the finance website Defaqto. Open a bank account elsewhere seems dto be the answer.
VARIOUS BANK ACCOUNTS At the time of writing with the financial market in a form of melt-down. The best advice in these circumstances is: 1. Investigate each offer carefully. 2. Look out for special offers - although some of which are not really so 'special'. 3. Find the best offer you can - but - keep a watchful eye on it because of the changing financial climate. Open a bank account elsewhere may be a good solution. 4. You may well get a very favourable rate of interest on any deposit/savings account. Banks now urgently need money because of their own liquidity problems following the sub-prime market fiasco. As mentioned above, First Direct is an offshoot of HSBC. Therefore, although it runs a telephone/on-line operation you also have the convenience of paying in your cash, cheques over the counter at any HSBC branch. But the catch is, First Direct do not offer such competitive rates as the telephone/on-line operations only. Only you can decide your priorities. One solution here is to use the convenience of First Direct to pay in your small amounts of cash. When the sum starts to accumulate, transfer the necessary balance to one of the high interest paying on-line operations. The best of both worlds. Good service and high interest will enable you to save. However, a very serious word of caution here. In February, 2007 HSBC (First Direct) introduced a new regulation whereby if you only hold one product with First Direct i.e., a cheque account then you will have to pay at least £1,500 into this account each month, or maintain an average balance on it throughout the month in excess of £1,500, or take out another product with First Direct. If you choose not to this you will be charged a banking fee of £10 a month for the account. Also there is no interest on this account. No wonder HSBC have been offering a £100 bonus if you sign up to this account. So think carefully before you act here. Definitely a case of doing your homework.
This is a completely on-line operation and at time of writing the interest on their savings account is 6.05%. This interest rate makes your aim to save money even easier. Alliance and Leicester, and Birmingham Midshires are also offering good rates to savers. Maybe the spur to open a bank account with another bank. LOANS Check that you have a good credit record when applying for loans – even missing things like a mobile phone payment for a couple of pounds can have a detrimental effect. The credit squeeze is taking effect and loans are now even harder to secure. An old time maxim is - Never a borrower nor a lender be! Just keep thinking - save all you can. Bank Accounts are an ideal place to put this into practice. Remember to limit your account savings to £35,000 until the legislation is improved. These are just a few illustrations of the offers that are available when you open a bank account. LEARN THE LESSON - IT IS YOUR CASH! One glaringly obvious tip regarding saving cash is to make sure your account remains in credit. Beware of exceeding your overdraft as the interest levied is painfully high.
Now - try to remember what the grim looking teacher is saying to you: Save money. A short time spent doing your homework will increase the amount of your money at your disposal. If in doubt open an bank account with a 'friendly' bank. Even if you are still a student it's never too early to start taking care of it! As a rule, telephone and online operations give a higher and better rate of interest than the big five organisations. Their overheads are less therefore they are able to be more competitive. Become a 'rate tart' and open a bank account elsewhere. This is likely to increase in the not too distant future if some penalties that the big five can impose are removed by law, and instead they start charging up to £300 for operating your accounts in order to maintain their already enormous profits. YOUR CREDIT CARD Make your credit card work to your advantage. If your card issuer is Tesco for example, use your card to pay for all your groceries, petrol, in fact anywhere you can. Pay the bill in full when it arrives, so that you do not incur any charges. Each quarter Tesco will send you the vouchers you have earned for using your card. These you can spend on groceries or petrol. A self-perpetuating roundabout to save money. Well worth using. Keep a very careful watch on your money and don't hesitate open a bank account elsewhere should it become necessary. Only you can watch your money. To assist you, take a look at our 'Related Pages' section below.
I heard it once, it said Goodbye”.
as up to date as possible, save-money-guide cannot be held responsible for any changes in legislation or for developments in case law since this information was published. This is particularly so in the present economic climate. Get all our money saving tips to keep you and your bank balance healthy. So easy to do.
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