While nobody would advocate getting even further into debt while you’re at uni – your student loan takes long enough to pay off as it is – credit cards and pre-paid cards can actually offer a good solution to your money problems, as long as you’re sure you can manage the repayments.

Pre-paid cards and credit cards look very similar to one another, but in fact they operate quite differently. If you decide you need some help with your finances, and you’re well aware that lenders aren’t in the habit of handing out cash for free, this guide can help you to make the right choice.

Credit cards

You’re probably most familiar with this form of credit – it’s one of the most straightforward ways to borrow money and, when used properly, makes your bank balance more flexible by providing extra cash when you need it. As long as you repay the balance in full by the due date every month, you will pay nothing extra (as long as there are no additional charges like annual fees) and purchases you make on the card are protected under the 1974 Consumer Credit Act, meaning you can get a refund if anything goes wrong.

If you can’t meet a repayment, that’s when things get a bit tricky. You’ll be charged interest – sometimes a lot of interest – that could in turn make it harder to meet your next repayment.

Pre-paid cards

Pre-paid cards allow you to set a spending limit according to your budget, rather than spending from your current account or through a credit agreement. They’re a great way to teach you to how to manage money as you just load money onto the card, then use it in exactly the same way as a debit or credit card.

Unlike credit cards, pre-paid cards don’t actually give you any extra money – but then again, that means you can’t get into debt with them. They’re very handy for using abroad and some are designed just for this purpose. However, you should check whether any fees apply to avoid surprises.

Article by Secure Trust Bank, winner of the Fair Banking Foundation award.

As such, it’s very much worth making sure you know exactly what you need to get before you start looking at student properties. Remember that as a student, you are entitled to the same rights as any other private tenant. After finding the best area for you, you ought to check a few things out before moving forward and signing a contract.

Firstly, you need to check if your landlord is licensed, otherwise you could lose out on many rights and end up in a very tough situation if things turn sour. If you are going to live with friends, you may need to check with your local authority to see if your landlord has to get hold of a House in Multiple Occupation licence for the property. HMOs apply if you have five or more unrelated people sharing the home and the property has three or more storeys.

Tenancy deposits and guarantors are a key issue that must be addressed, too. If you have found a suitable place to rent, landlords and letting agents will ask you to pay a deposit. With most students, a guarantor is also usually asked for in case rent is not paid or damage occurs. Make sure that your chosen landlord provides you with an inventory of the house’s contents, such as kitchen goods, the kettle, towel rack, toaster and such – this way you know exactly what’s covered. You will have your deposit returned in full if the home is not damaged beyond normal wear and tear.

Many others also ask for rent in advance. With this in mind, you must make sure to only pay your money when you’ve had a particularly close look at the property in question, ensuring that there aren’t any pre-existing problems that you could be blamed and charged for in the future. Things worth looking out for in particular include signs of disrepair, poorly-fitting doors, damp, security issues and poor electrical fittings.

Your deposit should be returned to you if all fees have been settled and the property has not been damaged beyond normal wear and tear. If you feel that it’s being withheld unfairly, see ‘Problems with rented student accommodation’ for tips on getting your deposit back.

Be safe and clever – don’t just sign up to the first house you see. After all, there are a lot of landlords out there who want your business!

Article by Pickard Property, specialists in Leeds Student Accommodation

• Always try and stay in control of your financial situation – remember to budget
• If you get into difficulty – ask for help at an early stage
• Make sure you are recieving your full state entitlement
• Take out your Student Loan
• Take advantage of student discounts
• Get the best deal you can from your bank – it is best to use a local branch with a student advisor
• Maintain communication with your bank and discuss difficulties with your bank manager before becoming overdrawn or going beyond agreed limits, thus avoiding un-necessary charges
• Pay bills on time to avoid ‘late’ charges
• Return library books on time to avoid fees
• Feed yourself properly and economically
• Keep your socialising within limits you can afford
• Do not buy all the books and equipment on your list without taking advice. Some may not be essential, or may be in the library, or may be available second-hand
• Do not be tempted by credit!
• Insure your possessions – burglaries are very expensive!

Once you have read the terms and conditions, and are certain that that is the account for you then it is time to sign up. Some banks let you do this online, others need you to go into your local branch, either way the process is the same – filling out some forms and proving your identity and address.
Exactly what the banks accept as forms of identification does vary from bank to bank, but as standard:

• Proof of Identity
• Current UK Passport
• Current UK photocard driving license
• Birth Certificate
• NHS Medical Card
• Proof of Address
• UCAS letter showing your name and address
• Student Loan Comany (or SAAS in Scotland) award letter showing your name and address
• University offer letter

Some banks also ask you to provide your letter of acceptance onto your university course as well as the two forms of identification above, and do note that you need two separate forms of identification (so your driving license doesn’t count for both).

Banks and building societies make plenty of offers for free CDs, railcards and much more in order to entice students to get an account with them, as most students stay with the bank they sign up with at this stage into later life when you begin to earn real money. However, contrary to popular belief, the basic offers from the banks, from interest rates to overdraft availability, vary wildly and it is worth checking out the financial offers before being wooed by the freebies.

Financial Comparison Points

Overdraft

This is a key feature of any student account, especially with the rising tide of student debt. Banks offer students varying amounts of interest free overdraft ranging from £1000 to £2000, and also have vastly different rates on the amount they charge you if you go over this amount.
Debit Card. Debit cards (normally showing the VISA or MasterCard logos) let you withdraw cash at cash machines (some banks charge you to do this at machines), and buy items in shops and over the phone/intenet, and are so a lot more useful than the standard cash cards offered with some standard current accounts

Credit Card

Credit cards differ from debit cards in that they are basically a loan from the bank, so if you buy a DVD for £20 on a credit card, the bank loans you the money, and you have to repay them. Some credit cards offer an interest free period where you have a few months to repay the bank before they charge you interest, others charge immediately. Credit cards also normally offer some form of fraud protection, so are often goog to use when buying expensive items or anything over the internet or by phone.

Interest Rates

The interst rates offered on money you have in your account range from around 0.1% to 3%, so is cerftainly an area of vast variation, and something to look at if you are earning and expect to be in credit for your univeristy career.

Access and Advisors

Specialised student financial advisors are offered to students by many banks to help you with any financial troubles, and bank opening times as well as phone and interent banking options are normally offered and do help when you start having to pay bills.

Free Banking

Make sure that you don’t have to pay any fees or costs for normal banking such as withdrawing money, paying bills over the phone, or checking your balance over the internet, as banks do offer premium accounts which you have to pay to get access to.

Branch Location

Make sure that there is a branch of your bank near to your university accommodation or flat, as if you are having financial problems, talking them over with a student advisor in person is normally the quickest route to a solution.

Incentives (Freebies)

This should be the last priority when choosing an account, but is useful when you are having trouble deciding between a couple of options. The banks know that £100 cash and discounted CD’s will get your attention, and rightly so, but don’t let that be the only reason for choosing that bank.

After taking the time to compare all the banks’ offers looking at the points above, you should be ready to open an account with the bank that best fits your personal needs, and help you through university and beyond.