Fee-Paying & Package Accounts

Some banks and building societies will try to promote their current accounts by offering a package of benefits in return for a regular fee. These accounts are known as fee-paying or package accounts. Due to increased competition, fee-paying accounts can vary considerably in terms of what is offered to customers. Frequently however, banks and building societies will offer high interest rates, low service charges and even free insurances to fee paying customers. You may be offered a current account with a higher interest rate and a free overdraft facility, in exchange for paying a monthly administration fee. The exact fee you pay will vary between financial institutions but will usually be calculated depending on the value of the benefits you are being offered. It is inadvisable to choose a fee-paying current account that charges high administration fees, since the high charge will cancel out any benefits you receive. If you are advised to open a fee-paying account, ask the financial advisor to explain why a fee-paying account will prove to be the better deal for you.