Best account for PGCE student???

Mallett94

Hi there,

I have just finished my 3 year BSc (Hons) degree. I had an HSBC student account of which my overdraft was £500 for the 3 years, however I only dipped into it on 2 or 3 occasions.

My account is due to be changed to a graduate account at the end of this month, however I am going to be doing a PGCE in Secondary Physics starting in September. I would like to open a student account with Santander for the 4 year rail card, but that's it really.

Also note that I get a rather large bursary packed with my studies (25k). I have a HTB ISA and a 30 Day Notice Cash ISA with Aldermore, and plan to save most of the bursary into here. But I'm tempted to open a First Direct 1st Account, which would pay me £100 cash and comes with a £250 interest free overdraft, but would also enable me to access the 6% regular saver account which I could max out each month. However the Lloyds Current account pays 4% on 4k-5k, or the TSB pays 5% on 2k.

I am just not sure what is the best thing to do in my situation. I will be going down to HSBC tomorrow to let them know I am a student for another year so they don't change my account. And I will definitely open the Santander Account for the railcard. But does anyone have any advice as to which Current account to go for? I am leaning towards the First Direct one and maxing out the regular saver account, with the rest of my savings going into my Aldermore ISA's, but I'm not sure this is the best strategy.

Thanks in advance for any advice!

YorkshireBoy

Lloyds pays 4% AER on £5K, and 3% AER on £400 a month in their regular saver.

TSB pays 5% AER on £2K.

Nationwide pays 5% AER on £2,500 (albeit only for a year), and 5% AER on £500 a month in their regular saver.

Tesco pays 3% AER on up to £6K.

BoS pays 3% AER on up to £15K.

What's the rate on the 30-day ISA?


Obviously you may not get all, or indeed any(!), of the above, but my point is to highlight the potential returns available outside an ISA (standard ISA that is, not your HTB which you should keep).

And in closing, simply opening an FD account wouldn't get you £100...you'd need to switch into it. Do you have an account to switch?

Mallett94

Hi, the HTB pays 2%, and the Notice pays 1.3%. I was hoping I would be able to switch either the HSBC or the Santander Student accounts into the FD account, but I couldn't find anywhere online saying if you could or couldn't?

Also are you saying it would be better to perhaps open several current accounts and leave the money in there/the accompanying regular savers, rather than lumping it all in the ISA which would probably have been the better thing to do before these new tax allowance rules?

Thanks.

YorkshireBoy

Mallett94 wrote: »

Also are you saying it would be better to perhaps open several current accounts and leave the money in there/the accompanying regular savers, rather than lumping it all in the ISA

There's some effort involved, but the return could be 3 times better for you. Do your own cost/benefit analysis.

which would probably have been the better thing to do before these new tax allowance rules?

5% less tax is 4%
4% less tax is 3.2%
3% less tax is 2.4%

All are bigger than 1.3%, with the smallest paying nearly twice as much as your ISA!

Westie983

I'm not sure you can switch student accounts as you would need to provide the documents again I assume and that you are only officially allowed one student account so may struggle to open one before you switch. Noting I'm not sure the incentive is on student accounts if you can switch.

You may find it difficult open main stream accounts as a student with irregular income so maybe worth sticking with your current one till you graduate once again and review this again when you are searching for non student/graduate accounts.