How to manage your bank account

One of the first steps to taking control of your money is learning the best way to manage your bank account. There are many types of account and bank card, so it’s up to you to pick the ones that best suit your lifestyle.

Types of bank accounts

Do you have more than one account? New services mean you can now see all your accounts in a single banking app.

First things first – work out what type of bank account will suit your needs best. This could be a current account, a joint account (shared with your partner) or a basic bank account (fee-free and without an overdraft).

Using your bank card

Bank accounts usually come with bank cards, which let you withdraw money and pay for clothes, food and other items in shops.

The main types are:

  • Debit cards. Sometimes a debit card is free to use. Sometimes you'll pay a fee to use the card.  If you have an overdraft on your bank account the cost for using it might be as high as a 40% fee.
  • Credit cards. These let you buy things on credit. You can spend up to a pre-set limit, which might be a few hundred or several thousand pounds. If you pass a credit check, you might be able to get a card from a bank or a credit-card provider.
  • Prepaid cards. These cards work like pay-as-you-go phones – you can only spend what you put in. However, because they often charge a fee, you might be better off with a basic bank account (see Types of bank account above).

Making payments into your bank account

There are lots of ways you can put money into your bank account.

Some of the most common include:

  • over the counter
  • online
  • Ii-branch deposit machines
  • by post.

Paying bills, friends and online shopping

To make payments from your bank account, a few options are available.

  • Direct Debits and standing orders. A great way to automate bill payments from your bank account. Particularly handy for regular monthly payments, such as energy bills. It’s important to keep track of any Direct Debits you have – you might have to pay a fee if you don’t have enough money in your account to cover them.
  • Phone and online bank transfers. A fast and easy way to make one-off payments.
  • Banker’s drafts and cheques. A useful way to send money or pay one-off bills. Write the details of your payment in your chequebook and give the cheque to the person you’re paying, or send it by post.
  • E-payments. Use technology such as PayPal or Apple Pay to shop or send money online. It reduces the risk of fraud as you don’t need to share your bank card details, but you will need to open a free account with an e-payment service provider.

Do you need an overdraft?

Overdrafts should only be used for short-term borrowing or emergencies. Unfortunately, it’s all too easy to treat an overdraft as your spending limit rather than as a last resort.

What does it cost to run a bank account?

If you do it right, running a bank account shouldn’t cost you much – it might even be free.

The key to avoiding fees, or paying as little as possible, is matching your bank account to your needs.

For example, if you regularly go into your overdraft, pick an account that doesn’t charge high fees for this.

Top tips for using your bank account

You can make sure you’re not paying unnecessary fees and are making the most of your account by setting aside just a couple of minutes to act on one or more of these tips.

Set up free text alerts

It’s worth giving your bank your mobile number so you can benefit from a new automatic service. If your bank has your number, they’ll send you a text alert if you go near or into an overdraft. This means you can minimise the impact of any charges for going overdrawn.

There are also free text alerts you can request yourself. Some will let you know when your balance is getting low and some can tell you when money has been paid in or out of your account. It’s a quick and automatic way of making sure you know what’s going on with your account, making it less likely you’ll be caught out.

Turning on these alerts is usually easy. Log into your account on your bank’s website and turn it on in your settings. If you’re having problems, you can call or visit your bank and they can set it up for you.

Use mobile banking

Using your bank’s app on your smartphone lets you do almost everything you can do in your bank using just your phone. That means you can check your balance, make payments, apply to change your overdraft - all whenever and wherever you want.

Banking apps are specially designed and tested to make sure they’re secure. They use special encryption, along with passwords, to make sure your account is safe from fraud.

Setting up mobile banking is quick. Have your bank card ready, and download your bank’s app from your phone’s app store. Each bank will have a different way of verifying your identity  — you might get a call, have to answer some security questions in the app, or visit an ATM to get a unique passcode.

After the app is set up, you’ll just need to enter your password to open it on your phone.

Find out what your bank charges you for

Banks charge you for certain things, like foreign cash withdrawals or transactions when you’re abroad. Look online or get in touch with your bank for a list of all the charges they can make and what they’re for. When you know how fees and charges are applied, you can make sure you’re avoiding them or keeping them low.

Speak to your bank

If you’re not sure your account is the right one for you, or what features it has to help you save money, speak to your bank. They’ll also help if you’re not sure about how to use any of your account’s features.

Most banks want to help you use your account to its fullest, helping you stay on track with your money.

If your account isn’t right, switch

If you’ve spoken to your bank and feel that the account isn’t right, now’s the time to think about switching. It’s easy to search for accounts to suit your needs, whether you’re looking for an account with a cheaper or bigger overdraft or one that pays you more interest when you have money in your account.

What if something goes wrong?

If you’re not happy with your bank, or something goes wrong with a payment, you might be protected.

Find out more

Was this information useful?
Thank you for your feedback.
We’re always trying to improve our website and services, and your feedback helps us understand how we’re doing.
Looking for us? Now, we’re MoneyHelper

MoneyHelper is the new, easy way to get clear, free,
impartial help for all your money and pension choices.
Whatever your circumstances or plans, move forward with MoneyHelper.

Continue to website
Looking for us? Now, we’re MoneyHelper

MoneyHelper is the new, easy way to get clear, free,
impartial help for all your money and pension choices.
Whatever your circumstances or plans, move forward with MoneyHelper.

Continue to website
Looking for us? Now, we’re MoneyHelper

MoneyHelper is the new, easy way to get clear, free,
impartial help for all your money and pension choices.
Whatever your circumstances or plans, move forward with MoneyHelper.

Continue to website
Talk to us live for…
Talk to us live for…
Talk to us live for pensions guidance using…
Talk to us live for money guidance using…
0800 011 3797* Hours
  • Mon – Fri:9.00am – 5.00pm
  • Sat, Sun and bank holidays:Closed

* Calls are free. We’re committed to providing you with a quality service, so calls may be recorded or monitored for training purposes and to help us develop our services.

Talk to us live for money guidance using the telephone
0800 138 7777* Hours
  • Mon – Fri:8.00am – 6.00pm
  • Sat, Sun and bank holidays:Closed

* Calls are free. We’re committed to providing you with a quality service, so calls may be recorded or monitored for training purposes and to help us develop our services.

Talk to us live for pensions guidance using web chat
Hours
  • Mon – Fri:9.00am – 6.00pm
  • Sat, Sun and bank holidays:Closed
Talk to us live for money guidance using webchat
Hours
  • Mon – Fri:8.00am – 6.00pm
  • Sat:8.00am – 3.00pm
  • Sun and bank holidays:Closed
Talk to us for pensions guidance using our web form

We aim to respond within 5 working days

Talk to us for money guidance using our web form

We aim to respond within 2 working days

Talk to us live for money guidance using WhatsApp
+44 77 0134 2744

Download app: WhatsApp

For help sorting out your debts, credit questions or pensions guidance. For everything else please contact us via Webchat or Telephone.