Graduate Accounts

Graduate Accounts

Cut the cost of post-uni banking

Don't just stick with your student bank after uni – loyalty can cost! Some banks let you switch even if you've not had their student account and you can get 0% overdrafts for up to three years. If you've graduated recently, see if you can ditch and switch your account to save £100s in interest.

The five BIG graduate account need-to-knows

  • The ultimate goal is to get a 0% overdraft to cover your full overdraft debt for as long as possible.

    First check what your existing bank offers, then compare to the top deals for switchers below in our top 0% graduate overdrafts section, though be aware that you'll need to pass a credit check to get a new account.

    This isn't about borrowing more. The aim is that by not paying interest, more of your money goes towards clearing your actual debt – and do it ASAP as the 0% won't last forever.

  • Stick with your current student account and you may find your 0% overdraft quickly diminishing in the first year after university. Some graduate accounts offer preferential terms for up to three years after graduation.

    Therefore, even if you graduated in 2018 or 2019, you may still be able to gain by switching to a graduate account now.

  • You'll have to pay off the overdraft at some point, usually after two or three years. Fail to do so and you'll be subject to astronomical charges and fees. The aim of the game is to gradually reduce the overdraft so that by the time you're being charged for it, you no longer have one. Banks try and encourage this by reducing the maximum 0% overdraft each year – the idea being that by the time the 0% ends you'll have paid it off.

    For a £2,000 overdraft which reduces gradually over three years, repayments need to be at least £56 a month. In other words, at the end of each month, your total overdraft should be £56 less than the previous month. To help, use the Free Budget Planner and Money Makeover guides.

  • Budgeting isn't a rule just for students, it's a rule for life. The game changes if you go beyond your overdraft limit – you can end up paying interest of up to 39.9% EAR.

    If you're struggling, talk to the bank at least and try to agree an extension but remember, it's always far better to plan and budget to avoid this.

  • If you're one of the lucky ones who'll be in credit for your first few years of 'grown-up' banking, forget overdrafts – focus on accounts which pay top rates and more, including cashback, travel insurance, or a cash sum upon switching. 

    These tend to give useful perks, rather than standard graduate deals of an extended 0% overdraft. Therefore to get them you'll usually need a regular income of more than a set minimum. See the Best Bank Accounts guide for more.

Top graduate accounts for switchers 2020/21

To be included here, banks must first let you switch to their graduate accounts - and only a few do that. Mostly, banks will only let you have their graduate account if you'd had their student account. Of the banks that do let you switch, we've ranked these by those that offer the biggest 0% overdrafts for the longest period.

All limits are "up-to" amounts, so you're not guaranteed to get them – how much you get depends on your credit score.

However, providing you've got no glaring issues on your credit file, the chances of getting the full amounts are decent.

All of the following accounts require you to pass a credit check (see Credit Rating guide).

Up to £3,000 0% overdraft in first year, plus £3+/mth rewards

The Barclays Higher Education Account is a decent option thanks to its generous fee-free overdraft of up to £3,000 in year one. There's a lower 0% limit in years two and three, so aim to pay it off gradually each month.

Plus, if you sign up to Blue Rewards, for a £4 monthly fee, you'll get at least £7/month back – so £3/mth after the fee – as long as you pay in £800+ and pay out at least two direct debits each month. You can get more cashback if you hold selected Barclays products (see FAQs).

How Barclays rates on service

54%                30%                16%
GREAT          OKAY              POOR
FEB 2020. VOTERS: 319

0% overdraft: 1st year after graduation: up to £3,000, 2nd year: up to £2,000, 3rd year: up to £1,000
Arranged overdraft cost (above 0% limit): Not available
Unarranged overdraft cost: No unauthorised overdraft available

  • You can get the account as long as you graduated within the last three years. Barclays will ask you for your graduation date when you apply, and you'll need to bring your degree certificate when you open your account in branch.

    After three years, you'll be transferred to a standard Barclays account.

  • You need to apply in branch, bringing your degree certificate and two pieces of ID/proof of address (see full list). If you want to switch, bring your current bank's debit card too so Barclays can get your account details.

  • No, there's no in-credit interest paid with this account.

  • You can also get extra cashback if you've got certain Barclays products:

    • £5/mth if you've a Barclays mortgage.
    • 3% back if you've a combined Barclays home insurance policy (£1/mth if you've either building or contents).
    • £1/mth if you've a Barclays loan.
    • £1/mth if you've Barclays life insurance (or £5/mth if you have life insurance with critical illness cover). You'll only get this in the first year of the policy.

    However, don't use the cashback as a reason to take out any extra products with Barclays without checking if they're right for you.

Up to £2,000 overdraft in the first year

TSB's Graduate Account offers fee-free overdraft limits of up to £2,000 in year one. There's a lower max 0% limit in subsequent years – up to £1,500 in year two and up to £1,000 in year three. The lowering limit provides a clear goal to help you clear the debt quicker but is also risky were you to miss that goal.

How TSB rates on service

39% GREAT
39% OK
22% POOR
FEB 2020. VOTERS: 197

0% overdraft: 1st year after graduation: up to £2,000, 2nd year: up to £1,500, 3rd year: up to £1,000
Arranged overdraft cost (above limit): 39.9% EAR/APR
Unarranged overdraft fees: 39.9% EAR/APR + £3 returned item fee. Max £30/mth total charges.
In-credit interest: None

Only one other account lets you switch to it if you haven't had its student account, though it's not as good as the other two in terms of its overdraft:

  • The HSBC Graduate Bank Account gives a 0% overdraft of up to £1,500 in year one and up to £1,000 in year two. The 0% limit depends on your credit score, but if you borrow more than your limit you'll pay 39.9% EAR interest.

    You'll need ID, proof of address and a bank statement to open the account, plus proof you've graduated in the past two years (eg your degree certificate). 

Top in-credit current accounts

If you don't need an overdraft after graduating, then don't go for a graduate account. These standard bank accounts have perks such as free cash or vouchers for switching, linked regular savers, and monthly cash rewards.

However, their overdrafts are often much smaller, or more expensive. Only do this if being overdrawn is a very unlikely scenario. To get any of the following you must have an adequate credit rating (see Credit Rating guide).

For the full range of our top pick accounts, see the Best Bank Accounts guide.