THE hardest thing about leaving university and entering the real world is learning to manage your money — or lack of it. Most students graduate with an average debt of £13,000 and find themselves on starting salaries of about £20,000 a year.

However, special accounts, loans and mortgages tailored for graduates can help to smooth the road to financial independence. But be careful that you do not end up paying too much for extra benefits or income protection insurance that you do not need.

Current accounts

The period over which you qualify as a graduate depends on who you bank with. HSBC considers you a graduate for up to five years after you have finished your degree, whereas the Royal Bank of Scotland, Lloyds TSB and Barclays will keep offering you graduate deals for up to three years.

Smaller banks, such as Alliance & Leicester and Halifax, do not have accounts specifically for graduates, although they offer higher in-credit interest rates on their regular current accounts. This may be a good option for graduates who do not need an overdraft. Alliance & Leicester’s Premier Plus account pays 5 per cent if you pay in more than £1,000 a month, while Halifax customers receive 3.04 per cent on any credit balance.

If you want both an interest-free overdraft and some reward for being in credit, then Abbey pays the highest rate — 1.5 per cent — on an in-credit graduate account that also offers an interest-free overdraft of up to £2,000.

As with student accounts, graduate packages usually come with freebies. Some are more useful than others, such as commission-free foreign currency with NatWest and the Royal Bank of Scotland. Other benefits, such as the 10 per cent off Blockbuster rentals offered by HSBC, are unlikely to make a big difference.

If you can afford to pay extra you will have access to a greater range of benefits with some banks. Barclays has a Graduate Additions account, which, for £5 a month, offers mobile phone insurance, Green Flag roadside assistance, cardholder protection and a legal helpline. Lloyds TSB’s Graduate Gold account is free to new customers until August next year, while existing customers switching to Graduate Gold will pay £5 a month for the privileges, which include card protection, mobile phone insurance and a travel service.

All graduate accounts offer an interest-free overdraft. Most start by offering up to £2,000 interest free in the first year, which is reduced by £500 each year. Interest on an unauthorised overdraft can be as high as 30 per cent, so make sure you know when your interest-free limit is due to be cut. If you are likely to go over your limit, speak to your bank. It will often agree to a lower level of interest.

Loans

As well as your student loan and overdraft, you may have debt on credit cards. A graduate loan is one way of consolidating your debt. Annual percentage rates are usually about 7.5 per cent, but there are lower rates to be found in the best-buy tables. Northern Rock charges 5.7 per cent if you have a good credit rating.

For many, a loan is a necessity. Matthew Pascoe, 25, took out a loan of £10,000 with Lloyds TSB. He had outstanding debts from university, including his overdraft and credit cards. He also wanted help to purchase a house. Matthew says: “You need some money behind you so that you can afford to make choices about your future. I didn’t want to have to worry, so a loan was the best option.”

The interest rate on Matthew’s loan is 7.7 per cent and he is repaying the loan over five years at £240 a month. However, he is also paying £40 a month for income protection insurance. This is an unnecessary expense, says Richard Mason, director of insuresupermarket.com. Mr Mason says: “He could have saved £28 a month had he bought a stand-alone payment protection policy. Policies sold with loans are bad value.”

Mortgages

Bradford & Bingley says that one in six first-time buyers needs help from parents to buy a home. Some lenders offer guarantor mortgages that allow parents to guarantee a child’s mortgage payments.

Melanie Bien, of Savills Private Finance, a broker, says: “Although guarantor mortgages are popular with graduates, some brokers will recommend standard mortgages that allow a guarantor, rather than specific guarantor mortgages, as these often have lower rates.”

Joint mortgages, shared between parents and a child, are another option. The Bank of Ireland offers a 100 per cent mortgage that will lend up to four times the parents’ income on top of whatever the graduate earns.

If you cannot rely on parental help, you may need a loan for more than the value of the property. Scottish Widows offers a 102 per cent loan, which is available to graduates between the ages of 21 and 35. It will lend five times your income at an interest rate of 5.75 per cent.