HSBC Bank Account Plus?

Lillyella_2

As I live overseas and have just noticed that I am spending a considerable amount on interest to HSBC whenever I use my Switch card to withdraw cash here, I wondered if it would be more beneficial to change my standard account to a Plus account, any comments would be welcome. I also wonder how good the Travel Insurance is that comes with it, is it worth £12.95 a month?

benjus

The standard HSBC debit card charges 1.5% (min £1.75) fee, plus 2.75% exchange rate loading. AFAIK the Plus account waives the 1.5% fee but still uses the same exchange rate (i.e. it still charges the 2.75% loading).

If you are withdrawing more than about £870 each month, the Plus account will pay for itself in saved fees alone, without considering any other benefits.

The travel insurance is limited to trips of up to 31 days, so if you live abroad this will probably not be terribly useful. In fact, you should check if it will cover you at all if you live outside the UK.

If you do still have connections to the UK (e.g. an address you can use), I recommend you try to switch to a Nationwide Flexaccount. This has no monthly charge, and does not charge any loading OR fee for overseas withdrawals - making it much cheaper than either HSBC account.

Another option would be to try to get an Abbey Zero credit card - but this is a credit card so to avoid interest charges you would need to pay it off from your current account every time you withdraw cash.

nzseries1

Martin claims in his current accounts article that Bank Account Plus (and other accounts that charge a monthly fee) is "an expensive pile of pants".

You can get annual travel insurance for £30-40 per year, and as benjus says above, you can get commission and fee-free withdrawls abroad by opening a Nationwide current account.

nzseries1

Check out this page:

http://www.moneysavingexpert.com/banking/compare-best-bank-accounts

And read this section:

WARNING.... Do you pay a fee for your bank account?

If you have a ‘packaged account’ from Barclays, Lloyds or NatWest banks, amongst others, watch out; these are usually an expensive pile of pants. Most people sign up after a sales call or e-mail promising many "great features" and telling you how much better it'll be with this holy grail of banking.

Now think about whether you’ve ever used those facilities and are they worth the price?

Step 1. Calculate the real annual cost. For example if you're paying £12 per month, that's actually £144 a year. Just because getting the packaged accounts gave you 'better rates' don't think that means you've got a top deal. The rates may be better than the pitiful deals these banks would give you otherwise, but they're easily beatable by the fees-free deals listed elsewhere in this guide.

Step 2. As the rates aren't good, you need to evaluate the benefits it gives you. Do you ever use them and if you do, is the account fee cheaper than getting them separately? For example, for less than £40/year you can get annual travel insurance or breakdown cover.

Step 3. Assuming these accounts aren't worth it, ditch & preferably switch to a non-fee account with the best rates; see the questions above for how to decide.