Current Accounts

Guide: Personal Finance

Choosing a Current Account

It is common practice for current accounts to be accessed and operated via numerous channels, including via the internet, telephone, post and in-branch. You can check the state of your balances, transfer money and set up standing orders. Online accounts allow 24 hour access to their account information.

So with everything above thrown in as standard, how to choose a current account? The answer is in the AER, or annual equivalent rate. This is the rate of interest that the bank will pay to you over a 12-month period. But buyer beware some banks will quote a different rate depending on how much money you plan on having in your account. Check the AER carefully if you plan on keeping a significant amount of cash in a current account. You may be better off with a high interest savings account for the bulk of your money, and putting just enough to live on in your current account.

In addition to the AER, there are numerous facilities that may be offered by current accounts, including debit cards and overdrafts. Account sweeping (automatic transfer of funds to or from a savings account) is also available on some accounts.

Make sure you read all the fine print, and find the current account the fulfils all your needs.

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