Bank Accounts: Your Financial Freedom Awaits
Without the modern bank account, we would be literally crippled in terms of our finances. These instruments have now become an essential part of our existence in these modern times. Whether you are opening an account for the first time or you are hoping to change providers, it is important to know the choices that you have as well as some of the top providers in the business today. Let's see what is in store.
The Types of Bank Accounts
Bank accounts can be broken down into three general categories. Theses are:
- Checking accounts (known as current accounts)
- Savings accounts
- Package accounts
Checking accounts are by far the most popular type in existence. These are generally used to pay off your day-to-day expenses. They can also be referred to as current accounts and on occasion, debit accounts. You can withdraw money from a cash point, pay bills online and automatically debit your account for expenses such as a mobile phone or electricity bill
Savings accounts are another common option. However, there are two main differences between this choice and a current account. First, the interest rates earned on a per annum basis are typically higher. This will allow you to accrue more money over time. Secondly, you may not be able to immediately withdraw money. If you do, you could be charged a nominal fee. The minimum balance within these accounts is also likely to be higher when compared to a checking account.
Packaged accounts are the third alternative that you will have. As the name hints, these clever devices offer you additional benefits as opposed to simply storing your money away. Some perks may include special offers (better interest rates or frequent flyer miles), cash-back deals at participating stores, car breakdown cover and even insurance for common devices such as mobile phones.
Choosing the Right Provider
There are several tips and tricks which can help you to select the correct institution. First, how accessible are they and do they offer multiple locations in terms of physical banks? Are you able to perform online transactions and if so, are there any fees attached? What is their reputation and what are other saying about the services that they provide? What are their overdraft fees and can you modify your account as you see fit? It is important to address all of these questions.
The Top Bank Accounts in the United Kingdom
As of the time that this article was written, here are some of the top providers in the UK:
- First Direct
Barclays offers up to 15 pounds a month in loyalty rewards as well as cash-back programmes at over 100 online retailers as well as through Expedia.
HSBC provides its customers with a 4 per cent AGR fixed rate for 12 months, a “flexible saver” programme and superior levels of customer service.
Santander boasts three per cent on all balances over 3,000 pounds, cash-back offers on selected household bills and a minimum deposit of 500 pounds each month.
First Direct includes no interest on the first 250 pounds, 100 pounds in cash-back savings when switching from another provider and access to preferential mortgage rates.