Setting up a new current account doesn't have to be daunting.
We've defined all the terms you're likely to come across when looking for a new bank account.
First of all, when looking for a new current account, it's important to know which types of account you'll qualify for and which are best suited to your financial situation.
The most commonly advertised current accounts are premium deals which offer some kind of reward: interest, cash back, a free overdraft or simply a cash payment for signing up.
We have more detail on the top deals at the moment over here.
However, here as there, we should note that these accounts aren't open to everyone: most ask for a minimum amount to be paid in each month and banks may reject those with poor credit histories.
Premium accounts may also be packaged accounts, which charge a monthly fee for a range of services, although some packaged accounts are far from premium.
Packaged accounts are sold as an efficient way to save time and money to organise some of life's must haves.
Though there are some doubts on that score benefits that could be included are travel insurance, breakdown cover and mobile phone insurance.
Some also incorporate VIP travel packages, personal account managers and lifestyle management services for a high monthly fee.
At the other end of the scale, basic accounts are available for those that have such poor credit histories that not only premium but standard bank accounts are unavailable.
These accounts have no fees but also no overdraft and limited access to other standard facilities.
We have more information on these products here.
Accounts for students and graduates
For students and graduates, banks offer special offers.
Banks are aware that the average student is more likely to be overdrawn than in credit, which is why the main selling point of an undergraduate bank account is its large interest free overdraft, usually of £1,000 or more.
Banks are keen to poach students when they arrive at university, as statistically these customers are likely to earn more than those who don't.
For these reasons there are often a range of shiny joining perks on offer in a bid to reel students in, like a free young person's railcard or toastie maker.
However, it's advisable to try and look past these freebies and opt for the biggest interest free overdraft on offer.
Interest free overdrafts are also be available to graduates.
Graduates can usually switch for up to three years after leaving university and will gain more time off from paying interest on the overdraft amount.
Finally, for those who have a high net worth but aren't sure what to do with their money, private banking can be a good option.
A private bank is one that is not publicly held, but is instead owned by an individual or partners.
Whereas in regular retail banking people manage their money themselves, with private banking the institution customises the solution.
They also manage the customer's assets and making investment choices on behalf of the customer.
An overdraft is a temporary facility of bank accounts where you can essentially borrow money from the bank on a very short term basis.
It is useful as it is a good safety net to allow you to pay bills on time but it can also be one of the most expensive ways to borrow.
An arranged overdraft is when the account holder has made an agreement with the bank for an overdraft to be set up on the account.
The bank will go through a process to check credit worthiness and that the account holder is able to pay back the borrowed money.
An unarranged overdraft is when the bank is not expecting the account to go overdrawn or feels that the account holder's history is too poor for them to be permitted to borrow.
Unarranged overdrafts will, therefore, charge you more as the banks see this as not managing the account properly.
Arranged or unarranged the bank will charge in two ways: interest as AER or daily fees.
When trying to decide what bank or provider to opt for, there will be a few terms you need to get to grips with to help you make a choice.
First of all the AER, which you use to compare interest rates across different accounts.
AER stands for annual equivalent rate and reflects, not just the amount of interest but also how often it is paid.
Why does regularity mean a better deal? If you are getting paid your interest every month rather than every year then the interest credited to your account each month will itself earn interest throughout the year.
This is the amount the bank will charge you each day for your use of an overdraft.
If you compare these between arranged and unarranged accounts it's clear that the latter can be very costly.
At the time of writing, for example, Halifax bank charge £1 a day for the use of an arranged overdraft up to £1,999.99 and £5 per day for the use of an unarranged overdraft up to the same amount.
For more on overdrafts see this feature.
You may not be new to current accounts and are instead looking to switch over to a new provider that is offering a better deal or service.
A new bank will offer certain conditions that will determine whether a person is fully applicable for the rewards it is offering.
For example, some accounts require a certain amount of direct debits/standing orders set up to the account within the first few months or weeks, at least in order for the customer to access all the account's rewards.
Aside from these conditions, there are a couple of specific services for new customers that are worth being aware of.
For more information on the process of switching a main account see this guide.
Most banks now offer a switcher service, which means they will manage all the admin involved in switching accounts for you.
This can include setting up existing standing orders and bill payments to your new account, contacting any Direct Debit companies to inform them to switch to your new account and organising a switcher overdraft.
The new bank will often offer an interest free switcher overdraft to cover money going out of your new account before money is paid in.
At the time of writing, these fee free planned overdrafts generally last for three months after the switch.
Bear in mind to qualify you are required to transfer existing payments from your old account.
Go back up to the current account deals