Student Banking
Funding your studies
- Get a student account with a fee-free arranged overdraft to give you more financial flexibility.
- Credit cards can be a good way to spread the cost of expensive items, as long as you can pay them off every month.
- Taking out a student loan is one of the cheapest ways to borrow money long-term and you don’t have to pay it back until you are earning over £21,000.
- A graduate account can help ease you into your working life by gradually phasing out your fee-free overdraft.
As a student, a great way to control your finances is to get as much advice and support as possible. Of course, that means talking money and bank accounts, but it also means looking at your lifestyle, too.
There are so many different bank accounts and financial products available, it can be difficult to know the best one to pick when you're a student. Here are some things you should look out for:
Student accounts
These bank accounts are specifically designed for students, so often include a fee-free overdraft. They also commonly include gifts or discounts for things that students use a lot or just like. But it's important to also look beyond the freebies.
Credit Cards
These can be a convenient way to manage your money when used appropriately. There's usually an interest free period, so if you can pay them off every month, that's great. They can also help spread the cost of expensive items.
Overdrafts
When you’re at university or college, sometimes you need the flexibility of extra money to help tide you over. Student overdrafts can be a short term safety net when you need to borrow some money. With our Lloyds Bank Student Account, you can apply for a fee-free tiered arranged overdraft of up to £1,500 in Years 1 – 3 and up to £2,000 in years 4 to 6.
Like all forms of overdrafts you’ll need to pay it back at some point, but don’t worry we’ll help you keep on top of your spending with mobile alerts to tell you when you’re close to or over your limit. Plus when you graduate, we’ll still be by your side, converting your student account to a graduate account. With our graduate account you can apply for a fee-free tiered arranged overdraft offer for the first three years, helping you move into professional life.
So all your payments are made, it’s important you manage your account within your arranged overdraft limit. If you don’t have enough money in your account or you reach your limit, you may not be able to make any more payments. If a payment takes you over your limit or we stop it, you won’t be charged.
Good and bad debt
With the advent of government-sponsored debt in the form of student loans, it is now common for most students to have some debt. But the real danger of this is that students might begin to view all debts as the same, when in fact they aren't. That's why it's important to understand what's meant by the terms 'good debt' and 'bad debt'.
A good debt might include something like a student loan because the interest so low. Obviously, no one wants to be in debt, but with loans such as these, remember that you are investing in your future.
Bad debt is the kind you get with high interest loans or store cards where the interest could be anywhere from around 5% up to 30% a year. Don’t forget, if you have a credit card and you pay your balance off before the required date, you won’t be charged interest. Most credit cards offer up to 56 days interest-free, so check with your provider to find out how many days they offer.
Student loans
Student loans can be among the cheapest form of long-term borrowing available. Your college or university can help you understand the options available to you and there are plenty of useful websites to help.
Graduate accounts
These are designed to ease you into your working life by still giving you features, such as a fee-free arranged overdraft, but phasing it down each year as you begin to earn more, helping you pay it off gradually.
When trying to choose a graduate account, an important factor to consider is the length of time you'll be able to use the fee-free arranged overdraft.
It may work out more expensive to pay a monthly fee, usually around £5-£10, than the no-fee accounts with the best fee-free overdraft conditions. The exception is if you think you’ll use the additional benefits and that they are worth the extra cost.
Check your balance regularly
Banks offer a wide variety of ways to check your balance, which can really help you stay on top of your finances, particularly when you are on the go. It’s worth checking if your bank offers ways for you to manage your money such as online, telephone and mobile banking.
Plus, you can check your balance at a Cashpoint® machine, at the local branch of your bank or even the Post Office®.
Important legal information
Lloyds Bank plc. Registered office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales No. 2065. Lloyds Bank plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 119278.
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Money Manager is provided to help you manage your personal finances and is not intended to provide legal, tax or financial advice. Personal Internet Banking customers only. Terms and conditions apply. Mobile Banking services may be affected by phone signal and functionality. Must be registered for Internet Banking. Terms and conditions apply.