Whether we like it or not, all of us have to depend upon banks for day-to-day life. These financial powerhouses provide us with liquidity when it is needed the most, they supply loans upon request and they may even determine whether or not we will ever own a house. It is for this reason why it is important to open a bank account and establish good credit history from the very beginning. Still, how does this process actually take place? What is involved, what types of accounts are available and what should you look for in a bank? These are all important questions which deserve to be answered in more detail.
Top UK Bank Accounts
The major banks in the UK offer different types of bank accounts for different people and their needs. These include regular current accounts, savings accounts, tax-free ISAs and many more. Most high street banks such as First Direct, Santander, NatWest & Barclays offer these accounts with some amazing perks and benefits. Therefore it is important to find a bank that is suitable for you and your banking requirements.
Top bank accounts in the UK include:
- Barclays Bank Account
- First Direct 1st Account
- NatWest Select Account
- NatWest Reward Account
- Santander 123 Current Account
The Mechanics of Opening a Bank Account
Applying for an account is rather straightforward. You will normally head into a branch office and speak with a representative. He or she will then ask for proof of identity as well as other documents such as a current utility bill. You will then be asked to provide a small down payment so that the account can be activated. An ATM card will arrive by mail within a few business days and you are also provided with online login details so that you can view your account balance as well as perform other actions such as money transfers.
The Different Types of Bank Accounts
Depending on your needs, there are several different accounts to choose from. Perhaps the most common is known as a debit account. This will allow you to immediately withdraw money from a cash point. There are normally daily limits in regards to how much can be taken out within any 24-hour period. You may also be able to overdraw the account to a certain extent. However, keep in mind that if you do not place funds back in, you will be charged with hefty overdraft fees.
A savings account is a second option to keep in mind. As the name hints, this type of vehicle will provide you with a higher interest rate than a debit account. The main point is that your funds will accrue over time. Most will choose a savings account to supplement a debit account or as a source of emergency funds. It is important to mention that you might not be able to withdraw money from the account (although this will also depend upon the policies of the bank itself).
A checking account is the third common variant. This is essentially quite similar to a debit account although you will also have the ability to transfer money and pay bills online. This is often a great way to pay rent as well as utility fees, as a direct debit option will automatically send money across whenever it is due.
What to Look for in a Bank
When setting up an account, there are a few factors to keep in mind. First and foremost, how many branches are there located close to your residence? What types of foreign cash point fees will they charge? What types of customer service are available and if you are interested in opening a savings account, are their interest rates competitive with other institutions? These are some of the most important factors to keep in mind so that you will be able to make a sound decision when the time is right.
