Should a Teen Have a Bank Account?
If you have teens, you know how tough it can be to teach them about money. One great way to start is to help them open up their own checking and savings account.
Did you know that 36% of students at 4-year universities noted that overdrafting and poor management of a bank account are the leading causes of their financial stress? It is… according to a 2015 Money Matters On-Campus Survey by EverFi and Higher One.
You see, starting your teen on a checking account early will help them avoid the financial potholes they may encounter in the future.
And making sure they have a savings account that they actually make deposits in is equally important.
If your teen does not have a savings account now, make time today to open one with them. And have them make a deposit today. Then instill in them the importance of making savings deposits on a weekly or at least monthly basis.
I also suggest you open up a joint checking account with your teen, as soon as you deem them to be responsible.
Have your teen do the shopping for checking accounts at various banks, making sure to include Credit Unions in your search. Consider fees, services, possible earned interest and location in your decision.
I also suggest you keep your teen’s checking account separate from their savings account to avoid fraud or over spending.
Teach your teen how to check their statements each month for correctness and how to look for fraud.
When presented, I recommend declining on the debit card option, instead getting the ATM-only card.
Use the excitement of opening a savings and checking account as a teaching opportunity.
Then set a good example with your own banking practices, that you can share with your teen.
The lessons they learn will be invaluable when they are on their own, and managing their finances by themselves.
And will save you many headaches when you have to rescue your teen (or later as an adult) from potential financial management problems.