Teaching financial management skills to your children is one of the most valuable life lessons you can offer them. One of the best ways to help kids develop financial literacy is to have them open their own savings account and, when they reach their teen years, a checking account under their name. Checking accounts can hold money kids earn from part time jobs, gifts from relatives and help establish good financial patterns for later in life.
Opening a Checking Account
As your child gets older, you can begin thinking about having them open a checking account. Several national banks offer special teen accounts. Key Bank, for example, has a program for teens 16 and over that is free and has no minimum balance requirements or monthly fees. Bank of America and Fifth Third Bank also offer checking accounts for teens 16 and up, as long as they have a student I.D. and a parent’s approval.
In most situations, banks will require these accounts to be linked to a parent’s account. You should also check with your local credit union, which may offer a similar program. While it is more difficult to open checking accounts for minors, many banks do offer these programs.
Have "The Talk" With Your Child About Money
Kids and money sometimes don't mix well, so be sure to talk with your pre-teen or teenager about how to use checking accounts wisely. When they have money kids may often be tempted to spend it right away, especially with the easy availability of funds that checking accounts provide. Tell your child that using a checking account is a great responsibility that should be treated very carefully.
Be sure to monitor your child’s spending, no matter how responsible you think they are. Early intervention can help curb unwise spending habits that may develop into a greater problem as your child reaches adulthood. Take this opportunity to teach your son or daughter how to spend responsibly.