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Behind the cash barriers; Our guide to managing your finances will help guide you through the money maze.

AT some point in your teens - and the earlier the better - you'll start to have money of your own.

This can come from a variety of sources - pocket money, gifts, an allowance from parents, student loan or earnings from a job.

For the first time in your life you'll be able to decide what to do with your own money. You'll want to use it in different ways, decide what to spend and save, and look after the little you have.

Banks and building societies want you as a customer. The chances are you'll stay with them, and so they look forward to having and using your money for years to come. There's fierce competition to capture younger customers, so many offer freebies to tempt you to open an account with them. Check the boxes on the right for some examples.

Different accounts

If your money is tucked away in the bank, you're less likely to go out and blow the lot in one go. A bank account helps you pace your spending if you limit yourself to withdrawing just so many pounds a week. A bank account also helps you keep track of your spending via regular account statements.

Having your own account will keep money safe but accessible until you're ready to spend it, and it'll help you manage your spending (ie budgeting) so your money lasts until next dollop of income comes in.

A bank current account is useful for money you don't need at once but are planning to spend rather than save. But a big issue is access.

If you are in school or working all week, think about how you'll get hold of your cash.

Is your local branch open on Saturdays?

Will you get a cash card?

Are their cash machines handy?

Will you have to pay (eg pounds 1 per withdrawal) to use them?

Does the account provide a debit card which you could use to get cash- backs at supermarkets?

It's a good idea to start to save early - even a few pounds a week. A savings account will gain more interest in the long term but cash will not be so easy to get at.

Opening a bank account

All banks and building societies must, by law, check your identity when you open an account. Normally, they need to see two documents, one which proves your identity, such as a passport, birth certificate, driving licence, library pass, or travel pass and another which proves where you live, for example, a bill, bank statement, driving licence (but not if you've already used it to prove your identity), or medical card.

The bank or building society concerned will tell you what documents they accept. If you don't have the proof the bank needs, you may be able to give the name and address of your parent or guardian, since their address can be checked against the electoral roll.

You may not need proof of identity if you are introduced to the bank or building society by an existing customer who knows you.

What are cash cards?

Plastic cards which let you get cash from a cash machine (also called an ATM, as in automated teller machine).

To use it, you must key in a four digit PIN. The PIN is the password to your account, so it's essential you keep it secret. If anyone else knows your PIN, they could steal money from your account. You can choose your own PIN, but avoid obvious numbers like 1234 or birthdates.

What are debit cards?

Plastic cards that act as an electronic cheque book. You can use one to pay for things in shops and to get cash back at supermarket tills. If you're under 18 or don't have much money in your account, you may be offered a Solo or Electron card. These are debit cards where your bank account is checked before every transaction, so you shouldn't be able to become overdrawn.

What about charges?

In September 1999, Barclays opened a can of worms when they announced proposals to charge non-customers pounds 1 each time they withdrew money from a Barclays cash machine.

Other banks in the LINK network of cash machines planned to follow suit, but dropped their plans amid consumer fury and boycotts of their machines.

However, LINK have some new members which are not banks and provide convenience ATMs in places such as nightclubs, petrol stations, and so on. These machines commonly charge you pounds 1 per withdrawal.

But customers often don't realise that they still, in some cases, face a disloyalty fee charged by their OWN bank when they use the cash machines of another. The disloyalty fee is generally pounds 1 or pounds 1.50 which is a big chunk of your money if you only draw out pounds 10 or pounds 20 a time.

Banks which do NOT charge disloyalty fees - and so let you get money free from any ATM - are Barclays Bank, the Co-op Bank, Halifax, Nationwide, the Royal Bank of Scotland and Lloyds TSB.

Some other banks have arrangements with just one or two rivals to use each other's ATMs free. Before you open an account, check which cash machines you can use free.

What about Internet and phone banking?

These are becoming more popular, although there are still some concerns about security, and who is responsible if cash goes missing from your account. Ask what services the major banks offer.

DEALSPOTTING

ALLIANCE & LEICESTER CASHCARD: Blockbuster Video vouchers.

BANK OF SCOTLAND SAVE ZONE: sports radio, data bank organiser, wallet or personal portfolio.

BARCLAYS BANK BARCLAYS PLUS: pounds 10 of cinema discount vouchers.

HSBC LIVE!CASH: voucher book.

ROYAL BANK OF SCOTLAND ROUTE 15: Personal organiser, discount on CDs, videos and computer games.

IF you're a student, the freebies are more likely to be cash (around pounds 40), free mobile phone, book or CD vouchers, and other discount vouchers. Always shop around for the deal which suits you best.

OUR TOP TIPS

If you can't get to a branch easily, choose an account with a cash card.

Check the cash machines you plan to use are free.

Get pocket money or allowances paid direct to your bank by standing order - that way you have less chance to blow the money before it reaches your account.

Limit how much you take out of your account to make your money last longer.

Keep track of how much you take out, so you don't become overdrawn.

Check your statements - banks do sometimes make mistakes!
COPYRIGHT 2000 Scottish Daily Record & Sunday
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2000 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Features
Publication:Daily Record (Glasgow, Scotland)
Date:Oct 4, 2000
Words:1087
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