Will opening new accounts + multiple bank switches hurt my credit score at 22?

sweetflowerpots5

Hi, I’m 22 and trying to get smarter with managing my money.

Up until now I’ve only ever had one Monzo current account and debit card. In uni I opened a Nationwide student account for the switch offer, but never used the account. I’ve never had loans, overdrafts, credit cards, or missed payments.

My income situation has changed recently; I’m on Universal Credit and recently got bumped up to LCWRA as I'm unable to work. I want to start properly saving and using higher-interest accounts rather than leaving money sitting in one place.

I’ve been researching the regular saver accounts, and my rough plan is:

• Keep £4k in a Santander Edge saver at 6%. (I've already done this step, I used the Nationwide student account to claim the switch bonus).
• Switch into First Direct for the £175 bonus and 7% regular saver (£300/month).
• Switch into Club Lloyds for the £200 bonus and 6.25% regular saver (£400/month).
• Use Nationwide Flex as my main account for their 5% interest on current account balances & for their 6.5% regular saver.
• Potentially NatWest or Co-op later, depending on how much admin I want.

For donor accounts to claim the switch offers, I:

• Accidentally opened the Santander current account twice, so I can use one of those for a switch - First Direct, maybe?
• I plan to open a Chase account and use the additional current accounts in the app (separate account numbers) as “dummy” accounts for future switches.

My questions:

1. How much do multiple current account applications/switches affect your credit score?
2. Do I need to stagger the switches?
3. I’ll be renting and moving out in about 6 months — could this realistically cause issues when referencing?

I’m not planning to apply for loans or credit in the near future, just trying to maximise interest and make the most of switch offers as I start to save money.

born_again

If you are on UC be careful you do not get pulled for a check on finances.

All them switches will make providing 4 months bank statements fun to say the least.

I would keep it simple, do one at a time & let them run for few months before doing another.

PRAISETHESUN

There's been some reports in recent threads saying that Chase might be starting to crack down on opening accounts just to switch them away. I'd open your Chase accounts now (no credit check) and spread the switches out over the next few months to avoid making them upset.

Outside of that, each hard credit check (such as when you apply for each current account) will leave a record on your credit file which lenders can see. A few searches spread out over a few months is neither here or there and won't be cause for concerns if the rest of your file is well managed. It definitely won't affect any rental searches.

And as a final aside, you shouldn't be focusing on your credit score (ie. the actual number) but rather the financial information on your credit files from all 3 CRAs. This is the bit lenders see, not the score. As a young person with a presumably thin credit file (no credit cards/loans/mortgage and a few current accounts) then this should be straightforward. Whilst you might not want credit now, after you sort out your current account plans you might want to consider starting to build up your credit history in case that changes in future.