Parents have a responsibility to their children to teach the fundamentals of money and money management at an early age. The younger children are taught the importance of saving money, the more likely they incorporate their money lessons into their adult lives.
If your child did not have a bank account established in their youth (see how this 10-year-old picked her bank), they should certainly start focusing on their banking needs when they are approaching their college years.
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A student’s bank account is a key part of their overall financial foundation. Parents may need to make deposits into a bank account so their away-from-home student can make withdrawals. Students will also need a bank account to pay their bills and to get credit cards and other financial services down the road.
Finding a good bank account that is appropriate for a student may be a bit overwhelming but it will be important for them to participate in the process. What they learn from their parents will help guide them financially into their future in the real world. Here are some helpful tips for securing the best student bank account:
If your student does plan to attend a college away from the home town, it is wise to find a bank that has branches or ATMs near campus or places that the student often visit. Parents should also have easy access to a branch or ATM because there is the need for the convenience of making withdrawals and deposits. More likely than not, a national bank will offer easy branch or ATM access for both parents and students.
Minimum Balance Requirements
Student bank accounts may experience a lot more activity than their parents’ account. It will be important to clarify what, if any, is the minimum amount required to remain in the bank. Some accounts have no limits but those that do impose minimum balance requirements can charge fees each time the account drops below that level. These fees can eat away the deposits being made into the account. Many banks will require a specific amount of money to initially open an account but do not require that amount remain on the account at all times.
By setting up account alerts, parents and students can remain aware of their balance levels at all times.
Students adjusting to a new life away from home and learning how to manage their own money for the first time are going to make mistakes. Forgetting to reconcile their checkbook or overdrawing their account at one time or another is very common and often chalked up to one of life’s lessons. However, if the bank you choose imposes super-high fees for these mistakes, students may start off their financial life on the wrong foot. Be clear about how much penalties will cost and go as far to speak with the bank in person to clarify how fees work.
Many banks are promoting a paperless society, pressuring customers to opt for online banking services rather than receiving paper statements and other bank correspondence. While many students belong to an age demographic that is more receptive of online and mobile banking, it is certainly worth reviewing what online banking services entail and if there are any charges for this service.
It is also important to reinforce the necessity of protecting online bank information. Students that bank via their mobile phones may increase their risk of theft when they fail to log out of their banking session or password-protect their phones which can end up in the wrong hands.
Parents can certainly be instrumental in establishing a good relationship between their child and a bank. However, students must also learn how to manage their own money. Having a bank account is a responsibility that cannot be ignored. Too many mistakes with your bank, intentional or not, can result in the inability to get a bank account down the road and can ruin a student’s financial life before it really gets started.
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