School may be out for the summer, but now is not the time to relax when it comes to teaching your kids more about personal finance. If you have a child headed to college this fall, start preparing them now by helping them open a student checking account, and through that process, start instilling into your kids the importance of good banking and money habits.
A student checking account would be the best fit for a late teen starting their banking journey, and it’s crucial to choose a great bank since many Americans continue to bank with the institutions they used as teens.
How to Find a Good Student Checking Account
When choosing a good student checking account, you’ll have to consider the availability of ATMs near your child’s school or campus. Some banks offer free out-of-network ATM withdrawals, but some don’t. Does your bank offer online banking or bill pay? Mobile deposit? Discussing with your child the different banking situations that may arise can give them some insight to the nuances (and annoyances!) of real-life banking and finances, and will allow them to think about their financial situation once they’re in college.
Be thorough when looking for a good student checking account, and consider all the fees that can potentially spring up. When you do your research, make sure to loop your child into the process, so that they also know to be vigilant about bank fees and charges.
According to a new survey, high school students are distrustful of financial institutions, probably due to the lackluster image of financial institutions from the past few years, so they may be more aware of fee details and make smarter decisions about choosing a bank and opening a credit card down the road. The same survey also found that the average college graduate leaves school with more than $4,000 of consumer debt, so help them get whip-smart with their banking choices now.
In addition, If your child is going to receive financial aid from college, signing up for direct deposit will facilitate faster access to any loan or grant funds. Learning about some of the automated aspects of banking can teach your child better saving habits, and you can take this opportunity to advise him/her about setting aside money earned from campus jobs or grants so that they can begin accumulating savings.
After your child gets his or her first bank account, they will eventually sign up for other banking services — such as a credit card, or if they’re really ambitious, a Roth IRA! Before this can happen, however, they will need to be equipped with the banking basics knowledge through opening their first bank account.