If it was somehow possible to x-ray the bank accounts of a randomly sampled group of students, the likelihood is that those bank accounts would be rather active ones akin to transmission accounts, with very little savings to speak of, if any. Most of the action these bank accounts would see would likely play out in and around the period during which the students get their allowances, with very little activity taking place as the next receipt of allowance draws nearer. So, since student life largely entails being economically savvy and is all about stretching every last pound to get every bit of value out of it, it can be rather hard to build up some savings while studying, but it definitely can be done.
Don’t Use a Traditional Savings Account
In a bid to capture what is a very big and lucrative college student market, banks have some accounts and other financial services which they market exclusively to students, some of which can be really useful in actual fact. With your parents or a designated sponsor as surety, students can even gain access to credit facilities on their student accounts, in addition to a rather competitive savings pocket with good interest rates. As with many other services of the financial industry however, if you USE ONLY AS DIRECTED you’re likely not getting the full value of the service. So you’re best served applying a little bit of a personal touch to the use of your student account if you have any hopes of building up savings that will grow into something meaningful one day.
Don’t rush to make use of your student account’s savings pocket, but rather get a separate transmission-type account to stash away whatever you want to put aside to save. The reason for this is true to the typical nature of a student’s finances — that being the fact that you might want to quickly dip into some of those funds you set aside for savings as the need arises. If you want quick access to money which you allocated to a savings pocket of your account, the penalty fees and charges will be considerably higher than they’d otherwise be if you withdrew the same amount of money from a transmission account. So if you keep your savings in a different transmission account, you can dip into them as required without having to pay high fees.
SAVE Your Savings
This may seem like an obvious statement, but it’s a very necessary one indeed because students don’t actually save their savings. If you make use of a student bus pass for example, instead of seeing the money you spared off the regular bus fare as some extra spending money in your pocket, rather view that money as savings you can put away.
Re-Visiting Traditional Savings Accounts and Financial Services
Once you have enough savings built up in your secondary transmission account so that you have some money you never have to touch, you can then move that money into a traditional savings account to enjoy higher interest rate returns.