Staying in clover while in the red

PEOPLE who regularly become overdawn can still profit from a low-charge current account, according to a survey by the Northern Rock Building Society.

The society looked at how a wide range of bank and building society accounts would perform for three types of account-holder: a professional couple; a pensioner couple; and a middle-aged couple.

The professional couple were assumed to have an average monthly credit balance of pounds 1,000 and an authorised overdraft of pounds 250, which they used for up to seven days a month.

Northern Rock concluded that over a year they could never earn much interest but they could save on charges. Banks would generally charge the most, but one building society, the Woolwich, does not charge overdraft fees and would leave them with a small net gain. Girobank's Keyway account performed the worst for these people, with a net loss of pounds 137.

The pensioner couple were assumed to have an average monthly credit balance of pounds 5,000 in a high-interest cheque account, making six transactions a month, and withdrawing interest for income. Chelsea Building Society's Classic account, Britannia Building Society's React 365 account and Northern Rock's current account were thought best for them - they would have gained pounds 317.50 with Chelsea over a year.

The middle-aged couple maintained an average balance of pounds 30,000, with four transactions a month. Chelsea Classic, Northern Rock's current account and the Halifax's Asset Reserve were good buys: Chelsea's account would earn them a net pounds 1,599 over a year.