This page gives you information about managing your money in the UK.

VOCABULARY

A bank or building society or post office offer financial services to customers through their branches, and may also offer internet banking or telephone banking. A branch is identified by a 6-digit number called a sort code .

Ways of transferring money from abroad to a UK account include electronic transfer. a banker’s draft and travellers’ cheques. You can change foreign currency into UK currency (pounds Sterling ) at a bureau de change or at a foreign exchange counter in a bank. The number of pounds you receive depends on the exchange rate which is offered, and you may also have to pay a charge known as commission .

The most common type of bank account used to manage your money in the UK is known as a current account (American English: checking account). The amount in your account is called the balance. If you have money in your account you are in credit ; if you have withdrawn more money than you have, your account is overdrawn and you may agree to borrow money by arranging an overdraft from your bank manager.

When you put money into your account you make a deposit ; you may need to complete a form known as a paying-in slip .

When you take money out of your account you make a withdrawal. You can withdraw bank notes at a cash machine (also called a cashpoint or an ATM ) using a cashpoint card by entering your personal identification number (PIN ). You can also take out cash by completing a form called a withdrawal slip and giving this to a cashier in a branch of your bank.

Regular bills can be paid directly from your current account by arranging direct debits or standing orders.

You can also pay for many things by writing a cheque (American english: check); you may be asked to show your cheque guarantee card. After a cheque has been given to a bank, it will take several days before it has cleared (in other words, before the money is put in your account); if the person who wrote the cheque does not have enough money to pay, the cheque bounces. You can also use a debit card. which pays money directly from your account and is accepted by most shops.

Another method of paying is by using a credit card (such as Visa or Mastercard ); in this case, the money is not paid immediately; you can borrow money up to your credit limit. but you will have to pay interest. You can see details about transactions in your account in a monthly statement sent by post from your bank or in a simpler mini-statement obtained from a cash machine.

Money can also be invested in a deposit account (sometimes known as a savings account ), which pays a higher interest rate but offers slower access to your money and does not provide other banking services.

SHOULD YOU OPEN A BANK ACCOUNT?

If you are only in the UK for less than 6 months, you may find it easier to keep your money in an account in your home country (using travellers’ cheques, bank transfers, credit cards and cash machines to access your money). If you are staying in the UK for more than 6 months, it may be useful to open a UK bank account.

Advantages of having a UK current (checking) account:

• Paying bills

Many landlords prefer to collect rent directly from a bank account (through a regular payment known as a standing order)

You may be able to obtain cheaper services if you pay bills by direct debit from a bank account, eg telephone/gas/water/electricity

If you are given a chequebook, you can also write cheques as a safe way of paying for things

You can easily obtain money from cash machines or from a bank, or pay directly from your account using a debit card

It is generally cheaper to use a UK account rather than paying by credit card or withdrawing cash from a foreign bank

One idea is to transfer all the money you need for your stay when you open your account. It is cheaper to make one transfer instead of many smaller transfers. Another advantage is that you will not have to worry about the risk that during your stay there is a sharp fall in the value of your country’s currency or a sharp rise in the value of the British pound. You will not benefit if your currency strengthens or the pound falls, but you can be confident that you will have enough money to be able to stay in the UK as long as you planned. Put most of the money in a deposit account, earning interest. Each month, transfer enough money from your deposit account to pay for all your living expenses, being careful not to keep enough money there to prevent your account’s balance becoming negative (otherwise you will have to pay overdraft charges).

CHOOSING A BANK

Who can you ask for advice?

Your school may have a welfare officer who can suggest which local banks are most helpful to international students, and what documents they require to open an account. You should ask your classmates or friends about their own experiences.

If you are studying at a university, there may be a financial adviser who could give you free advice about loans, bursaries, budgeting, benefits or taxes. This person may be a member of NASMA (the National Association of Student Money Advisers)

What are the names of the UK banks?