Published: 06/05/2009

Whilst a standard bank or building society current account won't cost you a penny to use as long as you stay in the black, unfortunately that's not the position for the millions of people in the UK who have been given the hard sell and persuaded to open a packaged current account.

Some of you may be wondering what a packaged account is. Well basically it's a current account which comes with a package of supposed additional 'benefits' for which you pay a monthly fee.

So, as well as the standard current account with cheque book, debit card and all the normal things you'd expect your bank to provide, you also get additional extras such as travel insurance, car breakdown cover, mobile phone insurance, restaurant/cinema discount vouchers and so on.

Now whilst this may sound a convenient and easy option, especially when the sales staff from the bank tell you how wonderful it is and how much money it will save you as they go through their pre rehearsed sales routine to sign you up, in many cases it turns out to be just the opposite.

Many people sign up and agree to pay the monthly fee which can range from £10 to £25 per month (yes that's up to £300 per year!) but then don't make use of the additional benefits and services that they're paying for.

The banks don't really care, as long as you've signed up and they are getting their fee from you month in and month out. They hope you won't remember why you're actually paying that fee that keeps appearing on your bank statement and that you'll never get round to doing anything about it.

So if you're going to do just one thing this week, then spend five minutes to check to see if you're shelling out a monthly fee for one of these accounts and that you're not just pouring your hard earned money down the drain.

It's a case of working out what benefits you do actually use and then doing the maths - and don't be swayed by the long list of wishy washy offers that you've never used or are never likely to either.

The long list of benefits may look impressive, but many of the discount offers can probably be beaten elsewhere. The advent of websites offering voucher codes has made the packaged account restaurant & hotel discounts a bit of a non starter.

There will of course be some people who will be getting value for money with their packaged account by using most or all of the benefits on offer, but if you're not going on holiday this year or find that you already have car breakdown cover as part of your car insurance then it's time to contact your bank to cancel your agreement and switch back to a standard bank account.

If you need travel insurance then you can find an annual worldwide policy for around £50 or car breakdown cover for less than £2 per month.

If you're cancelling your packaged account or just fed up with your existing current account provider, maybe it's time to move to a different bank. First direct will pay you £100 to switch to them (as long as you pay in £1,500 per month). Similarly, there's the Alliance and Leicester Premier Account where you'll also receive £100 for switching your custom as long as you pay in at least £500 each month.

Many people have had the same current account that they had when they left school or started their first job, but if you're not getting value for money or you're getting poor service then check out the current account search on Moneynet and find a better home for your bank account today.

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