This post comes from Amy He at partner site Credit.com.
School may be out for the summer, but now is no time to relax when it comes to teaching your kids more about personal finance. If you have a son or daughter headed to college this fall, start preparing her now by helping her 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 an older teen teen starting his banking journey, and it’s crucial to make a good choice, since many Americans continue to bank with the institutions they used as teens.
What to look for
When choosing a good student checking account
, you’ll have to consider the availability of ATMs near your child’s school or campus. Many banks or credit unions offer perks designed to appeal to students. Some offer free out-of-network ATM withdrawals, but some don’t. Does your financial institution offer online banking or bill pay? Mobile deposits? Figure out which features your student is most likely to use, and make sure those are available.
Discussing with students 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 situations 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 student into the process, so that he also knows to be vigilant about bank fees and charges.
According to a recent 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 your student become whip-smart with banking choices now.
In addition, If your student 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 her better saving habits, and you can take this opportunity to advise her about setting aside money earned from campus jobs or grants so that she can begin accumulating savings.
After your student gets his first bank account, he will eventually sign up for other banking services -- such as a credit card perhaps even a Roth individual retirement account! Before this can happen, however, he will need to be equipped with the banking basics knowledge through opening a student checking account.
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