Opening a bank account in a different country can be tricky but, here in the UK, by supplying a work contract, passport and proof of address it should be made simpler.
When opening a bank account opt for the basic account which usually has a monthly fee of about 4-6 GBP. You will most likely not be offered an overdraft facility in the beginning and if you do happen to go overdrawn you will be hit with severe penalty charges.
Banks have been known to charge up to 30 GBP for each day you go overdrawn and up to 90 GBP in one month! This may seem ludicrous, but most banks charge these excessive penalties.
After some time you may qualify for a premium account (for example Lloyds Platinum 15 GBP per month fees) which offers additional services such as car insurance, travel insurance and other incentives. If these are of little use to you there is no need to upgrade to the expensive account.
Bank staff might recommend you sign up to offers straight away, while at the bank, but it is a better idea to take the papers with you, read through them thoroughly and discuss it with your partner. If you decided to accept their offer you can always call them and they will be happy to help you but if not, thank them for their offer and tell them that you are happy with your current service.
If you do qualify for an overdraft you may be charged interest on this overdraft but if you do go over your approved limit you will be fined by the bank.
After some time you may qualify for a credit card. It is helpful to have one in emergency cases but you should be very careful when borrowing on it. The interest rates vary and can be quite high on some cards and it is very easy to accumulate debt. Drawing cash from the card is also very expensive. Check the terms and conditions of the card to know how much you will be charged.
I am under the impression that it is very easy to get into debt here in the UK and once you're in debt, it is difficult to get out of it. Many banks initiate debt by offering you higher credit limits than you can afford.
It is often a good idea to consolidate all your debt into one loan which you then pay off monthly.
When taking out a loan the bank will probably offer you loan insurance. In my experience, this is unnecessary as it makes your repayments higher and if you find yourself, like we did, in the position where you are struggling to repay a loan, when inquiring on loan insurance there is likely to be a clause in the terms and conditions that means you have to find a way to make the repayments, regardless of your circumstances.
|
