If you and your spouse have decided that your teenager is mature enough for their first checking account, then there are some things you should keep in mind while shopping for the best bank. Since your teen's first checking account is their introduction into the adult financial system, it is vital their account is inexpensive and works well to meet their needs. To this end, follow these tips while selecting the checking account that's best for your teenager:
Tip: Review the Fee Schedules for Various Accounts with Your Teenager
Since teenagers are a large market for banks and credit unions, most of the offer special teenage checking accounts. Sometimes these accounts are labeled as student accounts. However, the accounts and their fees will differ greatly from one bank to another. For this reason, you should obtain a written fee structure and benefits list for each open checking account your teen is interested in. Sit down with your teenager and show them how to compare all of the information and determine the best checking account to meet their needs.
Tip: Understand What Happens to the Checking Account when Your Teen Reaches Legal Age
It is important that you know what happens to your teen's new checking account when they become a legal adult, for instance:
- Does the checking account get closed?
- Is the account converted to an adult account?
- Does the fee schedule for the checking account change?
- Is the parent automatically removed from the account?
Before opening a checking account for your teenager, it is important you understand what will happen in the future with the account. Use this information when you are comparing different accounts between banks.
Tip: Share the Checking Account with Your Teen So You Have Legal Access to the Account
Since your teenager is still a minor, you should expect that the bank will require you to be a co-owner of your teenager's new checking account. Since you are a co-owner on the account, you are legally responsible for paying any fees or charges your teenager doesn't pay. It is vital that you explain the ramifications to your teen and they understand that overdrawing their account has very serious consequences.
Finally, since your name is on your teen's checking account, you have the legal right to monitor the account. Since a seriously overdrawn account will have a negative affect on you and your teen, it is important to keep an eye on the account to ensure your teenager is being responsible.Share