Choosing a bank
So choosing a bank may not be as interesting as choosing what to eat for dinner, but it could save you ridiculous amounts of money over your lifetime. Here's what to look out for.
Does your bank do online? Does it do it well?
Banking online means you’re more likely to manage your money properly because you can check your account any time. Your bank is likely to funnel you in the direction of online money-management tools and mobile banking because they’re cheaper (for them!). Despite all this, some banks are unacceptably bad at the internet. And, frankly, they don’t really deserve your custom.
Does your bank also have a friendly high street presence?
Sometimes you need to talk to someone – to discuss a loan or mortgage or to do a complex transaction. You don’t want to travel miles for the pleasure, so make sure your bank has also mastered the art of face-to-face communication.
Check their overdraft fees
An almost inevitable by-product of being young is being occasionally overdrawn. So comparing bank’s overdraft fees and other charges is a good way of saving money. Ideally pick somewhere that offers an interest-free overdraft. And also compare what the fees are if you go over your overdraft. There can be quite a difference. The Money Advice Service has a handy comparison tool.
Gimme some free stuff!
Sometimes banks offer all sorts of exciting (skateboard!) and not-so-exciting-but-useful (low interest rates) incentives to get you to play with them. Be careful though and check how good your account with them will be after they’ve finished wooing you.
Care about ethics?
Banks and bankers – let’s face it – aren’t up there with Gandhi when it comes to contributing to the wellbeing of our world. They invest in dodgy trades like arms, mining and fossil fuels and they don’t seem to understand that causing economic crashes every five minutes doesn’t make you popular.
There are still options though. Move Your Money is a great website that lets you check how ethical each bank and building society is.
Credit unions may be more ethical than your usual McBanks and are worth investigating, but they tend to be local and not always ahead of the curve when it comes to online banking.
Isn’t switching banks a really big deal?
We’re more likely to change long-term lovers than banks, but actually, switching from one bank to another is simple. Or it’s supposed to be anyway. Theoretically you just have to pick somewhere better and let them do all the work (bear in mind they’ll probably drop a ball or two, so you’ll have to pester them to make sure all your direct debits have been transferred). The switching process should take less than seven working days and you can even choose the date it all goes live.
- The Money Advice Service offers free, unbiased and independent advice about all financial matters. 0800 138 7777
- Moving out for the first time? Get the real Home Truths.
- Chat about this subject on our Discussion Boards.
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Updated on 29-Sep-2015
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