So you’ve finally graduated and it’s time to get prepared to leave student life behind. We understand that this is a stressful time and that there are so many things you need to consider, from job hunting to moving back home and everything in between. That’s why we thought we’d remind you of the importance of getting your finances in order, and switching to a graduate bank account is one of the easiest ways to do just that.
To help you decide which bank account would be best for you and your current financial circumstances, we’ve shortlisted some of the best graduate accounts of 2019, based on a range of factors such as great perks, interest rates,overdraft limits & fees and so much more.
Firstly, how do you choose the best graduate bank account?
Graduate bank accounts aren’t a one-size fits all type of deal, and each has its own pros and cons that will vary according to individual graduates and their own personal circumstances, so while one account may be great for your friend, it might not be the one that will benefit you the most. Ask yourself these questions before you make a decision:
Are you in credit, or currently sitting in an overdraft?
If your bank balance is currently in credit, then looking for a graduate account with low overdraft fees may not be of much interest to you. If this is the case, then choosing a bank that has better sign-up perks and a good interest rate on positive balances could be the better option, unless of course you feel you may need an overdraft to fall back on for whatever reason.
Many banks offer wider incentives such as cash-back rewards on your regular spending, cash rewards direct to your bank when you switch and even freebies such as discount cards and travel perks.
If you are currently in your overdraft, or you feel that budgeting really isn’t your strong point and you’re going to need a buffer there to help you out, then you should choose the bank account that has the longest 0% interest rate overdraft.
It might seem tempting to go for the highest overdraft limit possible, but remember that getting into further debt than your existing negative balance should be avoided at all costs – a graduate account isn’t there so you can borrow more, it’s there to give you that little bit longer to get yourself back into positive funds.
It can be difficult to claw your way out of an overdraft, even if it is completely fee-free, so if you’re the type of person who is tempted to use this extra buffer simply because it’s there, then it’s advisable that you choose an account with a lower limit.
How long has it been since you graduated?
Graduate bank accounts aren’t just for brand new graduates that are fresh out of university. Often when you graduate, your student account will be automatically converted to a graduate account by your current provider. This can often be the easiest option and at the time of graduating you may not have given it much thought. But easiest doesn’t necessarily always mean best. This goes for if you’re a new graduate too – sticking with the same provider as your student account may not always be the best option.
The bank that offered you the best student account, may not be the bank that can offer you the best graduate account, so it’s worth checking out where you’d be better placed. Not many banks pay rewards for loyalty, so regardless of how long you’ve been with your current provider, don’t get too attached.
Banks often reserve their perks for new customers, so take a look around and see if another provider can offer you more than your current one. If you’re lucky enough to already be with the provider that offers the biggest benefits, and they automatically switch you to a graduate account, then you’re better off staying and the work is taken care of for you.
Graduate bank accounts are typically available to those who are still within 3 years of their graduation date (most banks take this as June 30th in your graduation year.) So we would recommend regularly reviewing the terms of your account, as you’re able to switch between bank accounts at any point during this time frame to maximise the benefits.
What are your next steps?
Where you plan to head in life following graduation can be an important factor to consider when choosing the best bank account for you. If you’re likely to do some travelling, then a graduate account that includes travel and gadgets insurance could be of use to you. Alternatively, if you’re likely to begin work straight away and have a regular income, then an account with a higher interest contribution on positive balances could be the one for you. Planning on saving for something like a car or a house? If you’re in credit and ready to begin saving, then you may want to steer clear of graduate accounts altogether and choose a standard account with great perks and good savings account offers.
The Best Graduate Bank Accounts for 2019
In the table below we’ve outlined the best graduate bank accounts, detailing overdraft terms and perks. These aren’t ranked in order, as we mentioned previously, each bank will have different benefits for different people, so remember to bear the above information in mind when choosing which is the right option for you.
*All of the overdraft limits detailed are the maximum ‘up-to’ amounts, so you’re not guaranteed to be eligible for this full sum.
|Provider||Bank Account||0% Overdraft Limit & Borrowing Term||Unarranged overdraft fees||Can you switch to this account after graduating?||Perks and Benefits|
|Barclays||Higher Education Account||£3,000 – in year 1 after graduating
£2,000 – in year 2
£1,000 – in year 3
|When going above limit – £1,000 – 50p/day, £2,000 – £1 per day. E.g. In year 3, if you’re £1,001 or more into your overdraft up to £2,000, you’ll be charged 50p/day.||Yes, open to all graduates providing you can prove you’re within 3 years after graduating.||Blue rewards – £3/mth to earn £7/mth|
|Santander||123 Graduate||Up to £2,000 for 3 years after graduation||£5/day||No, you must have held a Santander Student Account.||Earn 1% interest on balances between £100-£199
Earn 2% interest on balances between £200-£299
Earn 3% interest on balances between £300-£2,000
|Nationwide||FlexGraduate||£3,000 – in year 1 after graduating
£2,500 – in year 2
£1,750 – in year 3
|N/A||No, you must have held a Nationwide student account.||No fees if you go over your overdraft limit, however you won’t be able to withdraw cash or make any payments until you fund your account back to within the agreed borrowing limit.|
|HSBC||Graduate||£1,500 – in year 1 after graduating
£1,000 – in year 2
|£5/day||Yes||Access to ‘Connected Money’ to view all your accounts in one place, regardless of the provider.|
|NatWest||Graduate||£2,000 – in year 1 after graduating
£1,000 – in year 2
|£8/day when £10 or more over the limit||No, you must have held a NatWest student account.||Free Tastecard membership
No overdraft fees if exceed limit by less than £10
|Lloyds Bank||Graduate||£2,000 – in year 1 after graduating
£1,500 – in year 2
£1,000 – in year 3
|N/A||No – you are able to switch while you are still a student if you bank elsewhere, or else you must’ve held a Lloyds Student Account||No fees if you reach your overdraft limit, however you won’t be able to withdraw cash or make any payments until you fund your account back to within the agreed borrowing limit.
Everyday Offers – up to 15% cash back
Access to Money Manager to keep track of spending
|Bank of Scotland||Graduate||£2,000 – in year 1 after graduating
£1,500 – in year 2
£1,000 – in year 3
|1p for every £6 borrowed up to £1,250
1p for every further £7 borrowed between £1,250 – £2,500
|No, you must have held a Bank of Scotland student account||Earn up to 15% cash back
‘It’s on Us’ prize draw entry with a chance to be paid back for something you’ve bought up to £500, every month
Grace period, giving you until 2.30pm each day before you are charged
|TSB||Graduate||£2,010 – in year 1 after graduating
£1,510 – in year 2
£1,010 – in year 3
|Under £10 – no fee
£10 – £25 – £5/day
£25+ – £10/dau
|Yes||Fees charged capped at 8 times per month
Eligibility to opt in to saving by rounding up to the nearest pound, automatically transferred to a savings account each time you spend
Grace period – you will get until 10pm each day before you are charged
|Royal Bank of Scotland||Graduate||£2,000 – in year 1 after graduating
£1,000 – in year 2
|£8/day on amounts over £10||No, you must have held an RBS Student Account||Free Tastecard membership
National Express Coach Card remains valid for four years, if you received this card with your student account
|Halifax||Student Current Account||£1,500 – in year 1 after graduating||N/A||No, this is an extended student account||This account isn’t really a graduate account at all, it merely allows you to keep your student account open for one year after you graduate.
Earn 0.01% on all positive balances.
Eligibility to opt in to saving by rounding up to the nearest pound, automatically transferred to a savings account each time you spend.
No overdraft fees, however if you reach or exceed the limit, payments may bounce