Student Banking

martinbloor

Hello, im goin to be going to uni in septemberish time and i was thinking about accounts and whatnot, ive just gotten a little confused i think.

i have an account with natwest, which may or maynot turn into a student account automaticly (i cant quite recall it was a while ago when i started it up) this account is the account which money from my job goes into and an account with a building socety which has More money in. I was reading about the 'deficit banking' and decided this was for me as im unlikly to get in to much debt as i work quite a bit.

halifax bank of scotland offer a big over draft as i read in an artical.

say they gave me an overdraft of £1,960 over the three years as appears to be the average, this means a monthly of about 50 pounds, to be honest i dont understand the way it works to well, i asume they want me to pay it back before the end of the month before they charge me lots more (like credit cards?) to well. could i with draw 50 pounds from my over draft, put it into a high interst savings account with most probably some other money in it. and then on the last day of the month put it back, and then the 1st day of the next month take it out again and put it in my savings account.

does it work like this?

i will have all my student loan stuff and possably my own money in the same account (the one with more interst) so from what i understand i get given 50 pounds effectivly for the whole three years (minus the time its back in the over draft account for the turn of the month) for me to earn intesrt on

also would it be possable to automate the transfers from one bank to the other, and asuming that i used cahoot(savings) and bank of scotland (over draft) how would i go about this?


thanks for any help,

mart

moneyandmountains

martinbloor wrote:

say they gave me an overdraft of £1,960 over the three years as appears to be the average, this means a monthly of about 50 pounds, to be honest i dont understand the way it works to well, i asume they want me to pay it back before the end of the month before they charge me lots more (like credit cards?) to well. could i with draw 50 pounds from my over draft, put it into a high interst savings account with most probably some other money in it. and then on the last day of the month put it back, and then the 1st day of the next month take it out again and put it in my savings account.

does it work like this?

No. If you have a £1000 interest free student overdraft, then you can take £1000 out of the account on day 1, and then pay it back at the end of the 3 years. You don't have to pay it back each month like a credit card. Banks normally increase the overdraft as you go through your student years. So if you are not going into debt, you can stick your money in your savings account for 3 years, and then at the end of the 3 years pay the money off.

There are normally conditions associated with student accounts, such as you must pay your loan amount etc. into it each year. However, once funded you can take the money straight out.