Teens and Banking?

[Just Kate]

Ds (12) has a few little jobs, but earns a pretty nice income for a 12 year old! He's pretty good at saving his money for big purchases, but I hate that he has so much cash just sitting in his bedroom. Also, he will occasionally want to purchase something online, so I make the purchase with my card and he reimburses me.

 

I had the idea that it would be neat to have a joint checking account set up for him so that he could learn to manage his money a bit better. He could have a debit card to use and we would work together on saving, giving, and spending (which is what I've been teaching him since he was little). I called my personal bank and they don't allow this type of account until age 15. I started looking online and it looks like some other banks allow it at age 13. I wonder if there is anywhere that would allow it for a 12 year old?

 

I would also love to attach a savings account to the checking account so ds could move the money around himself and learn the enjoyment of saving. 

 

How have you handled introducing your teen to banking and saving? Our goal here is to raise a saver who spends with a plan.

Edited July 13, 2016 by Just Kate

[The Girls' Mom]

I started all of mine out with just a savings account.  It at least gave them somewhere to start.  Once they started driving, we opened checking accounts with a debit card.  I'm not sure about banks that open a checking account at 12...at least I don't know of any.  

What I found helpful is to set up online banking for our accounts and connect them.  (I don't know how many banks do this).  We all have accounts at the same credit union, and I can transfer money between the accounts online.  I am joint owner on all of the accounts.  This allowed them to save, but then transfer the money to my checking if they wanted to order something online.   

 

ETA:  And now it is super helpful when I need the girls to pick up something from the store for me, or they need emergency gas money..etc.

Edited July 13, 2016 by The Girls' Mom

[Pawz4me]

We opened savings accounts for each of ours a few weeks after they were born. But I can't remember when we started their checking accounts. It probably was somewhere around 15.

[AK_Mom4]

Talk to your bank. We go through a credit union and were able to issue a debit card for a joint account in my kid's name when he was 12 and traveling. He had to have a state Photo ID to get the debit card In his name, but it wasn't an issue. This was 8 years ago.

 

For the other kids we opened joint checking accounts to go with their savings when they got their license at 16 and needed access to their money to put gas in the car.

[Happy]

I think an ID might be the biggest issue. Our youngest had an account at 11 or 12 in part because he had a passport as an ID. We spoke directly to the branch manager which helped too.  We were jointly on that account until he was...hmmm....21, maybe? Somewhere in there.

[mommyoffive]

I need to get on this.  I know I had a bank account when I was 5 ish.   I haven't done this for my kids yet.

 

What does he do to earn money? 

 

This was on my to do list all summer and I am not on it.

[Peach]

We opened a savings account with our 15 year old and she had to have a state ID here too. 

 

[mommyoffive]

Just start a savings account for now.  My younger kids are 3, 5, and 7 and they all have a kids savings account.  Most banks offer some kids version and usually it has some additional kids perks.  Something like a particular online interface, or rewards for putting certain amounts in, or regular deposits or something.  Just check with the local bank, they all vary.  But regardless....putting money in a savings account doesn't just lock it away.  The only real difference between a savings account and a checking account is the ability to take the money out at the point of sale.   Meaning, with a savings account, if a kid wants to buy a $75 toy, they can't just go to walmart and swipe a card.  But...they CAN go to the bank and withdraw $75, then take that $75 cash and go to Walmart and buy the toy. 

 

Did your kids have to have id?

[Okra]

I will echo what others have said about our children having a savings account. (No ID needed to open, and a parent is on it).  At Driving age, children opened checking accounts and got debit cards.  This worked great for us.

 

I would say that for now, it is okay for you to pay for something and have him reimburse you.  It's okay to wait until he is older to get a debit card.  

 

Overall, it sounds like you are doing a great job teaching him about finances.

[Just Kate]

Thanks everyone for the feedback! My kids both have savings accounts that we started for them as infants. Not a lot of $$ in them, but they are there.

 

I guess I will just wait until he turns 13 and set something up with one of the banks I saw online. I can see benefit in him learning to manage money this way. And this is my first-born, with a major Type A personality. He is super responsible and likes to do things in a very "grown up" way. Not sure dd (currently 8) would be ready for this sort of thing at 12. But ds appears to be.

[Miss Mousie]

My son (15) has had a savings account since he was about 8 or so, because I wanted to teach him the value of saving.  Unfortunately, that's really hard to do when the state of the economy means the account earns one cent per month!

 

I plan to have him open a checking account whenever he gets his first real job (not just cash for chores and odd jobs). 

 

[SparklyUnicorn]

My son (15) has had a savings account since he was about 8 or so, because I wanted to teach him the value of saving.  Unfortunately, that's really hard to do when the state of the economy means the account earns one cent per month!

 

I plan to have him open a checking account whenever he gets his first real job (not just cash for chores and odd jobs). 

 

Yep

 

These accounts earn no interest.  I think this is very crappy.

[Lilaclady]

There are banks that do this- not an ad but PNC bank allows 12 yr old to open an account and get their own debit card. An adult also have to open an account and it is linked. They require ss card and adult ID. She can log in online and manage her account but I see everything from my log in

[Tita Gidge]

I started all of mine out with just a savings account.  It at least gave them somewhere to start.  Once they started driving, we opened checking accounts with a debit card.  I'm not sure about banks that open a checking account at 12...at least I don't know of any.  

 

What I found helpful is to set up online banking for our accounts and connect them.  (I don't know how many banks do this).  We all have accounts at the same credit union, and I can transfer money between the accounts online.  I am joint owner on all of the accounts.  This allowed them to save, but then transfer the money to my checking if they wanted to order something online.   

 

ETA:  And now it is super helpful when I need the girls to pick up something from the store for me, or they need emergency gas money..etc.

 

This is what I did with each of mine, too. And now that most of them are older teenagers, I agree to how helpful it STILL is!

 

We opened up savings account from a young age. My ex-husband's family comes from a culture where gifts are almost always cash, so it made sense. From the age of 8 or so I'd walk them in so they could fill out the deposit slips, etc. and learn how to non-digitally bank. My ex-husband teased me but I thought they should still know how to do it old school!

 

We did open checking accounts for them at 13, when the bank allowed. The kids all had passports and I'm a joint owner on the account. This linked their accounts to mine both at the ATM and online.  At the same time we linked their savings accounts as an "overdraft" account so that if they overdraw their checking account, there'd be no fees; the money would be taken from savings. The bank issued a debit card but I never activated it for any of the kids. I didn't want them losing it (which they would have) nor did I want ME to lose it (which I would have. I lose mine at least once a year.) At this point I try to get them in the habit of carrying a wallet.

 

Once they start driving, and can carry a wallet without misplacing it too often, we go back in and get a new debit card. This time we activate it and it's all theirs to keep and to use. Two of mine still walk in to deposit their checks LOL. The others just use the ATM. I still walk in, too. I'm all about the free lollipops at the counter :)

[Prairie~Phlox]

We started with savings as well & then got checking around 14. All three of my teens work & use the app on the phone/ipod to deposit checks or go to the bank. I can have it linked to my account, but have chosen not to. They all have debit cards & have wise spending habits. They have quite a bit saved from working at an early age.

[Alessandra]

Ds has an account with a debit card for emergencies. I don't really like debit cards. He also uses no-fee Visa cards purchased from bank.

 

I also will be putting him as an authorized user on one of my credit card accounts. I will choose one that reports authorized users to credit rating bureaus -- not all cc companies do this -- so that Ds can benefit from my credit rating.

 

ETA

Check with your bank about custodial accounts. The bank may issue the debit card with your name on it, not your son's name.

Edited July 14, 2016 by Alessandra

[BlsdMama]

Call your bank and ask.  

 

At our bank, in order to get a checking account, the child must have issued photo ID.  All three of our oldest (14, 17, 20) have their own checking account through our credit union and access online with a debit card.