The time has come for your teen to have their own checking account. Maybe they recently started their first job, were gifted with a large sum of cash, or are heading off to college soon.
Beyond being a safe place to store money for spending, a teen checking account is an excellent introduction to the real world and an education in smart spending. Even if your teen has a ways to go before adulthood, they will be tasked with making impactful financial decisions sooner or later. Overspending now could mean less saved or, even worse, overdraft fees. But spending wisely could mean saving more and meeting big goals, like purchasing a new car.
Keep reading to learn more about teen checking accounts and what to look for when narrowing down your options.
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What Features Are Important For a Teen Checking Account?
Not all teen checking accounts are equal. Some are designed to help your child make sound money management decisions that will serve them well in the future. Others don’t quite live up to the hype and only cover the basics.
The best teen checking accounts offer these vital features:
Fee-Free with No Minimums
Teen checking accounts that are free allow teens to maximize their dollars. Avoid options that take a bite out of their funds by charging monthly maintenance fees or penalties for not maintaining a minimum daily balance.
Consider overdraft fees when evaluating teen checking accounts. They’re a hefty price to pay for mismanaging funds but can be avoided if your teen is responsible and monitors their account. Better yet, choose an account that won’t charge overdraft fees even if your kiddo slips up.
Avoid overdraft protection for your teen’s checking account if it’s offered to you. It may seem like a good idea to link your credit card, line of credit, or savings account to the account just in case, but it’s much wiser to decline the protection. This will teach your teen from learning to take responsibility for poor spending habits. A checking account like MoneyLion’s will protect them from overdraft fees as they learn.
Mobile and Text Banking
If your teen is always on the go, mobile banking can allow them to stay on top of their money. They can log in to check balances, initiate transfers, deposit checks, and review transactions 24/7 with online access.
Real-time text alerts are also useful and can help avoid unwanted fees. With MoneyLion, you can create text alerts that will notify your teen when their balance falls below a certain level or if their purchase exceeds a set amount.
Mobile wallets like Apple Wallet are another major plus. If your teen leaves their debit card at home, they can still buy what they need at the tap of their phone at some registers.
Vast ATM Network
Most teen checking accounts include a free debit card that can be used to make purchases or withdraw funds. This makes it convenient to head to the nearest ATM when they need cash, but it can also be costly if there are ATM fees.
Choose a financial institution with a vast ATM network so your teen won’t incur excessive fees each time they withdraw cash from their checking account. Most banks and credit unions have an ATM locator tool on their website or mobile app to help you identify free options in your area.
Educate your teen on other ways to access cash from their account. Many big-box retailers, drug stores, and grocers offer free cashback at the point of sale.
Inquire about ATM-fee reimbursement, as some banks and credit unions may offer this luxury. This is especially true for those with online checking and savings accounts.
Planning For The Future, Look For an Account That Offers More Than Just Checking
Built-In Money Management Tools
You want a checking account for your teen that includes built-in money management tools. They provide an analysis of spending habits and help your teen develop budgeting and saving skills they can take into adulthood.
A good teen checking account bank may offer other savings or investing tools that offer the potential for a return. Even if it’s a small percentage, you’d rather your teen earn a few dollars than park their extra money in an account that returns nothing.
Encourage your teen to put any bonus earnings to good use. They can build a cushion or start investing and building wealth.
Cashback rewards are another feature to look for when researching teen checking accounts. No need to settle for a teen checking account with minimal incentives when your teen could receive cashback when they make a purchase.
Budgeting, saving, credit, and investing are components of personal finance your teen should master to become financially literate. Look for a financial institution that offers free educational resources to teen checking account holders. The lessons they learn will be useful in the years to come.
Who Can Qualify For a Teen Checking Account?
Your teen can qualify for a checking account with ease. But there are a few important essential considerations to be mindful of.
Most banks allow teens aged 13 to 17 to open a teen checking account, and some go as low as 8 years old. When they turn 18, your teen may have the option to convert the account to a standard checking product.
Until your teen turns 18, a parent or guardian must be listed on the account and is deemed a co-owner. This means both parties have shared responsibility for the account.
What if your teen racks up excessive ATM withdrawal fees or overdraws the account? Even if you didn’t initiate the transactions, being a co-owner means you must resolve the issue to remain in good graces with the bank.
How To Sign Up For a Teen Checking Account
There are 3 ways to sign up for a teen checking account – online, in person, or by phone.
Open a checking account for your teen online in just minutes. If you already have an account with the bank, you may be able to go through the online portal and apply even faster with a pre-filled application.
Teens can visit a local branch to open a checking account. If they are under 18 years of age, a parent or guardian must be present.
Be sure to have the following on hand:
- State-issued driver’s license, identification card or passport (parents and teens only)
- Social Security card or Birth Certificate (teens that do not have a valid form of identification)
If you have questions about teen checking, feel free to contact the financial institution at their toll-free number. They can address your concerns and walk you through the online application if needed.
Choosing the Right Teen Checking Account
Teen checking accounts can help your teen navigate the banking system and develop healthy financial habits. Their first account should offer a suite of benefits that make it easy to manage their funds.
Help your teen do more with their money with an innovative banking membership from MoneyLion. They offer free checking accounts with generous cashback rewards for teens that are 18 years of age or older. Your teen can also lay the foundation for a solid financial future with their credit-builder and investment products.
Learn more about MoneyLion and how it can optimize your teen’s banking experience.