The material presented here is for educational purposes only, and is not intended to be used as financial, investment, or legal advice.
4 Reasons Your Teen Should Have a Checking Account
Teens are too old to be treated like children but not quite old enough to handle money completely on their own. A checking account for your teen can be the perfect way to teach them financial responsibility while still keeping an eye on the way they manage their money.
Just yesterday, they were a gap-toothed 6-year-old. Before you know it, they’ll be off to college. Today, your teenager is straddling the worlds of childhood and adulthood, hungering for life lessons and experience yet too young to be out on their own. While you have the chance, now is the ideal time to teach your child how to manage money responsibly.
One of the best ways to do this is by opening a checking account for your teen. A teen checking account is a basic checking account in their name (as well as yours) which gives them the freedom to manage and spend their money while you can supervise their account use.
Did you know? 34% of teens ages 13-18 don’t have a bank account.1
Here are four reasons to consider opening a checking account for your teen:
1. Teach Your Teen Basic Money Management
Just a few years down the line, your teenager will likely have their own account and independently manage their finances. They’ll need to know how to maintain their accounts, use a debit card, make withdrawals and deposits at the financial institution of their choice, use online or mobile banking tools and more. By opening a checking account for your teenager now, you’ll give them a head start on these crucial money management skills.
2. Help Your Teen Budget Better
There’s nothing like being in charge of your own money and accounts to help you make responsible financial choices that look beyond today’s impulse buys. Letting your teen see the balance in their account grow or dwindle can be a powerful motivator for them to stick to a budget and spend within reason. A checking account of their own provides your teen with the autonomy that will help them learn to budget better.
3. Give Your Teen Independence — Under Your Watch
Every teen craves independence, and a checking account in their name is second only to having their own car as far as helping your child feel in control. A checking account for your teen is truly the best of both worlds since a minor under age 18 will also need your name on the account. This means you can keep an eye on the account balance and step in if you see your teen is having trouble managing their account or developing potentially harmful money habits.
4. Help Your Teen Establish Their Financial History
Everyone’s financial journey has to start somewhere. By opening a checking account for your teen, you are establishing the building blocks of their financial history. This can come in handy down the line when lenders look for evidence of your child’s financial responsibility.
Did you know? 71% of teens report they are concerned about their credit score.1
While a checking account does not directly impact their credit score, teaching financial responsibility at a young age can lead to establishing good money habits. A checking account for your teen can be the perfect way to help them learn crucial money skills they’ll need as an adult. With your guidance, it can also help them stave off bad habits that can potentially derail even experienced grown-ups. Consider these benefits of opening a teen checking account and then head down to your bank or credit union. Your teen will thank you!