WITH school behind them and university beckoning, new students need to start thinking about how they will manage their finances.

While Scottish students preparing to attend a Scottish university are at an advantage in that their fees will be paid for them by the Scottish Government’s Student Awards Agency for Scotland, life as a student still does not come cheap.

Indeed, according to financial information website Save the Student, anyone studying in Scotland will spend an average of £774 each month on living expenses alone, while the average figure for those studying across the UK as a whole is slightly higher at £807.

When the cost of paying tuition fees is added in for Scottish students studying elsewhere in the UK - or rest-of-UK students studying in Scotland - it is no wonder that Save the Student’s recent National Student Money Survey found that 79 per cent of students worry about making ends meet.

Thankfully, as Rosie Bannister of Money Saving Expert, put it, high street banks “compete in a red-hot battle” to secure student customers, meaning when it comes to managing everyday finances there are savings to be made.

It may seem obvious that all students, many of whom will be managing their own finances for the first time, will need to have a bank account. But choosing the right one from a market saturated with freebies and offers can be easier said than done.

According to financial information website Moneyfacts, it will almost always make sense for students to opt for a specific student account, given that “not only can these accounts offer great deals on railway travel or other attractive bonuses, they usually come with low or even no overdraft fees”.

“That means that if you end up spending a bit more than you have in your bank account, you won’t have to worry about fees and interest adding to your debt,” it said.

For consumer organisation Which?, the best student accounts come with a generous zero per cent overdraft that will last the duration of the account-holder's course, while any other perks should be judged based on whether they are required or not.

It recommends two accounts in particular - Nationwide’s FlexStudent and Santander’s 123 Student - both of which extend their 0% overdraft offer into the first two years following graduation.

Those choosing the Nationwide account will be able to run up a £1,000 overdraft in the first year of study, with that increasing to £3,000 by year three and beyond, although they must commit to paying in £500 per term to keep the interest-free rate.

The interest-free overdraft on offer at Santander is smaller, starting at £250 in year one with the ability to increase that to £1,500 if £500 is deposited each term.

Despite the lower credit limit, Which? said the “top student account freebie is offered by Santander”, with its four-year railcard for 16- to 25-year olds designed to allow account-holders to enjoy a third off rail travel for the duration of their university careers.

Moneyfacts, which noted that HSBC, Barclays, NatWest and RBS have some of the best student overdraft deals on offer, also said the Santander account is a “great choice for students who regularly travel by train”, but noted that RBS and NatWest are strong on incentives for those who do not.

“Both offer students the choice of one-year free membership to Amazon Prime Student and a £10 Amazon.co.uk gift card or National Express Coachcard, which is valid for four years and gives a third off fares plus 15% off travel to events and festivals, or a tastecard, which is valid for four years and gives 50% off food, or two-for-one meals plus savings on entertainment,” it said.

Regardless of which bank account students do ultimately decide to go for, one thing to be aware of is that the way their account is managed could have an impact on their credit score, something that could prove financially detrimental as they move beyond university and into working life.

While Kelli Fielding, managing director of consumer markets for credit rating agency TransUnion UK, noted that taking out student loans will not have an impact on a student’s credit rating, practically everything else they do financially will.

“A student loan is not recorded on your credit report,” she said. “It’s treated differently to other types of finance so it won’t have any impact on your credit score, but things like credit cards, overdrafts and personal loans, which many will be using for the first time as they head off to university, will all start contributing to the score.

“Managing money carefully is essential to build a good credit profile and will help students get onto the credit ladder.”