Why NOW is the time to switch current accounts!

Financial resolutions are among the most common for the New Year - and for many people this will simply mean saving more or paying off debt.

12:41 28 January 2013

But just as many will also ignore one area that could help them achieve this - their current account.

 

Thanks to the competitiveness of this market, banks and building societies are keen to attract new business and this means offering increasingly lucrative deals to those who are willing to switch current accounts.

 

So if you are among the estimated three-quarters of people who have never switched your day-to-day bank account, chances are you are missing out. Here are three options worth checking out.

 

Plump for customer service with First Direct

 

If good customer service is important to you, then first direct is the bank to switch to. It won the Best Overall Provider in the 2011 MoneySupermarket's Supers awards and, in 2012, achieved the highest ever score for a bank in a Which? customer satisfaction survey after getting 93%.

 

And from January 7 until 31, if you've not tried first direct before, you can earn £125 by switching to its 1st account.

 

The usual incentive is £100 but the bank is extending festive cheer by adding £25 on top of this. In addition, you will get an automatic £500 overdraft, with the first £250 of this allowance being interest-free and you get access to its Regular Saver account paying a table-topping AER of 8.00%.

 

However, you must be able to pay in at least £1,500 per month to qualify for the account and there is no interest paid on in-credit balances.

 

First direct is so confident you will enjoy banking there, it is also promising a further £100 if you choose to switch away to another bank within 12 months. That means you can get a whopping £225 just for moving your cash around.

 

Have a Halifax New Year

 

Halifax is waiving all charges on planned overdrafts for the first 12 months if you switch to its Ultimate Rewardcurrent account, Reward current account or basic current account - even if you have an existing overdraft you are also transferring.

 

The deal applies to those who make the move between now and March 3. The money is credited to the new account on the day that the switching process is started.

 

According to Halifax, based on the current average overdraft rate of 19.65%, if you switch to any of its current accounts with a planned overdraft of £700, you stand to save £137 in overdraft charges alone.

 

Anthony Warrington, director of Halifax current accounts, said: "Over the last year we have seen unprecedented demand for our current accounts with 300,000 customers moving over from other banks."

 

Your options

 

Halifax's Reward Current account is one worth looking at if you are thinking of switching. Unlike the Ultimate Reward current account, there's no monthly fee and you will earn £5 on each month you pay in £1,000, making the account particularly suited to salaried people. Under this arrangement, at the end of 12 months you will be £160 richer.

 

 

The Ultimate Reward current account will charge you £10 if you pay in at least £1,000 a month, or £15 if you don't. In exchange, you will get a number of benefits including travel insurance and home emergency cover, but these are only beneficial if you will actually use them.
 
For the M&S faithful

 

You may feel as though customer loyalty is a thing of the past, but it still rings true if you are an M&S customer. Eager not to be left behind, the banking arm of the high street retail giant has launched a limited offer for new current account customers.

 

Unlike its rivals, which are offering cash, the bank will give £100 M&S gift vouchers to anyone who opens its M&S Premium Current Account with insurance, or the M&S Premium Current Account without insurance between now and February 28. Both accounts have been specifically developed with the M&S shopper in mind, so they are perfect if you love the brand.

 

As the name suggests, the Premium Current Account with insurance, which charges a monthly fee of £20, comes with a raft of benefits totalling £500. These include M&S vouchers, hot drinks vouchers for the M&S Café and exclusive access to a linked savings account paying a fixed AER of 6.00%. Loyalty points on M&S debit card purchases and other benefits are also available.

 

The M&S Premium Current Account without insurance on the other hand only costs £15 a month and comes with all the banking and reward benefits similar to its sibling account, albeit with just over £300 worth of annual benefits.

 

Should you go for it?

 

Most of the benefits are designed to be used in-store so these accounts are most beneficial to faithful M&S customers. Even then however, you need to work exactly whether you will use the benefits to make the account worthwhile.

 

At £15 a month, you will fork out £180 in fees alone in one year for example, but this sum can be offset if you make use of the more than £300 in benefits such as the 12 vouchers for 20% off M&S shopping available to switchers in the first year.

 

Compare, compare, compare!

 

Most importantly though, you need to shop around thoroughly to ensure you get the best deal. There are other accounts offering different types of benefits that may well be suited for you, so use MoneySupermarket's current account comparison service to identify the best option for you.

 

Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.