A current account is a convenient place in which to keep your money, where you can access it easily either through a branch of the bank, via a cash machine, cheque or by use of a debit card.
Having a current account is essential for the majority of people, with their wages or benefit being paid into this and the only way by which they have access to this money.

A current account is designed as a ‘temporary’ place to keep your money, with funds constantly going into and out of the account, as such the interest rates offered on a current account is lower than found on savings accounts, often as low as 0.1% although better rates than this can be found – see our list of the best current accounts.

Most current accounts will have an overdraft facility, this allows you to draw out more money from your account than you currently have in it up to a certain limit, in effect borrowing money from your bank. If the overdraft is interest free then this will not cost you any extra money, however most accounts will charge on overdrafts and the interest rates are generally quite high on this. When choosing a current account you should look into the details of the overdraft facility on offer to see what costs you may face if you use it, the rates on this will tend to vary between banks and so can be a good way of differentiating between accounts.

A current account is a necessity for most people, and many will tend to pick who they go with on reputation alone and not even compare the services on offer, this is not a good approach as the interest rates alone vary wildly between current accounts, ranging from 0.1% to over 4% which is a significant amount of interest that you could be losing out on over the course of your life. The charges made by banks on current accounts are also an important factor when deciding between accounts, some banks will have large charges for unauthorised overdrafts, whilst other will only impose a small penalty – finding the right account could potentially save you large sums of your hard earned money.

When you compare current accounts you need to look primarily at the interest rates (and be sure that they are what you will be actually getting and not just an introductory offer with strings attached), but you should also take into account other factors such as the overdraft facility and the convinence offered to you – will you be able to bank over the phone or interenet? For a list of the best people to talk to about moving to a current account that will offer you more, see our list of the best current account providers.