5 Student Overdrafts - road to ruin?!

7sefton

I'm very canny with money - as a student, I've got to be. After being inspired by stoozing, I've got 4 student bank accounts with interest-free overdrafts which I have maxed out. £3,600 is in a Fixed Rate ISA paying 6.31%, the rest is in a Principality e-Saver. The accounts are as follows:

Halifax - £2759
Abbey - £700
HSBC- £750
NatWest - £1250

I also use smile as an everyday current account, which has an overdraft of £1000 which I sometimes use (but the account is always active and often in credit).

The obvious benefit is that I earn money from the overdraft cash that is in savings. My student loan of about £2000 every 3 months is paid into Halifax to keep it active (then swiftly paid out to smile). The others have 'dummy' standing orders paying in small amounts each month to keep them active.

So far, fingers crossed, I've had no problems. However, with all the talk of credit scoring on this site I just wanted to check if what I am doing isn't crazy. I've not spent the money, so can pay it back at a moments notice. I'm keeping the accounts active, which I hope will prevent them getting closed. Obviously they are on my credit record, but as long as I don't go over my agreed o/d surely this isn't a problem.

Right?!

Cheers for any advice.

Extant

Why do you shout all your questions?!

And yes you are right. You shouldn't have a problem doing this. It's probably a bit dishonest, since the T&Cs might require you to use the accounts as your "main" accounts, which you obviously are not.

Lokolo

If you are spending all your time in your overdraft your internal scoring will not be good, so they are less likely to be nice to you in the future.

Also if banks don't see a regular income of X (whereas you amount could be a lot less) they may see you being in trouble and withdraw the overdraft.

Other than those things and what Barclaysmanager said its fine.

Also HSBC state in their T&Cs that if you want a student account with them it must be your only one, which means you are going against it and they could withdraw it at anytime without notice.

Mike1989

Being in your overdraft all the time probably won't, as Lokolo said, will probably mean your internal scoring won't be that good. But I suppose as long as you pay back any agreed amount, it won't make that much of a difference. I'm still surprised you have got away with having four student current accounts...