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  Sunday 20 May 2012

Don't put up with a poor deal on your current account. It's never been easier to move your money, so use this website to find the best bank account deals and ditch your current provider.

Six out of seven adults (85%) have a current account and even though they probably have a greater impact on our day-to-day lives than any other aspect of our personal finances, the vast majority of us stick with one tried and trusted bank throughout our adult life.

Research shows people are more likely to get divorced than change bank account, however, the consensus among consumer groups is that this loyalty is misplaced and makes no sense when all you get in return are miserly rates of interest on balances in the black, and sky high charges on balances in the red as well as poor customer service

The inertia among bank account holders is helping to boost the profits of the big high street banks.

So how do you find the best deal?  The most appropriate account will depend on your circumstances.

If you have a tendency to slip into the red, you'll appreciate how expensive overdrafts can be, with many banks charging interest as well as hefty fees. If you always stay in the black, your first priority should be to source an account paying a competitive rate of interest on credit balances.

Interest on credit balances

If you would prefer to keep your money in your own pocket rather than swelling your banks' coffers, you should take a moment to check the interest you're getting paid on balances in credit as some banks pay as little as 0.1%. By switching elsewhere you can earn significantly more!

Overdraft facilities

If you rely on an overdraft facility you need to check the rate you are being charged on your overdraft. The average authorised overdraft is around 15%. Research by consumer group Which? reveals that, with the most expensive account, someone who goes overdrawn by £500 for two weeks every month could pay over £200 a year. However by switching to one of the best buy accounts, the overdraft would cost about £13.

The rates for unauthorised borrowing are even higher with huge penalty fees levied. Which? estimates that one in four consumers are liable for punitive charges for unauthorised borrowing.

Switching  

The big high street banks rely on their customers' misplaced faith to go on boosting their own multi billion pound profits, however with increased competition in the current account account marketplace, you no longer have to settle for a bank account which pays a pittance when in credit and charges hefty overdraft rates if you slip into the red.

There appears to be a belief among UK consumers that switching bank accounts is difficult. This is a complete myth as moving your current account is straightforward. Once you have contacted your new bank and filled in the forms, they will do all the hard work for you and arrange to have all your direct debits and regular payments transferred.

Incentives

Many banks offer incentives to attract new customers such as high credit interest, low rates on overdrafts, cashback and access to competitive mortgage products. However, examine the true cost of these offers before signing on the dotted line as they may not always offer the value for money that they first appear to.

You also need to take into consideration the length of the as some accounts offer an introductory rates for 12 months, so unless you're prepared to switch again in 12 months time, it might be worth opting for an account that offers a lower rate for a longer period.

Finally, it's always worth consulting with friends and family about their experiences with a particular provider. This may help you gauge useful information which is not going to be apparent in the best-buy tables such as the level of customer service they experienced.

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