Considerations for Opening Teen’s First Checking Account

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Starting out on one’s own in college involves many financial firsts. Opening a checking account to manage money might be just one of them.

As your child prepares to head off to school, he or she should begin to shop around and find a bank or credit union that offers the best deal. Many banks (both local and national) and credit unions offer accounts tailored specifically to young adults.

Some things to keep in mind when shopping around include:

  • Is there a monthly maintenance fee?
  • Are there overdraft charges?
  • Does the account pay interest?
  • Does the account come with free checks?
  • Is there an ATM on campus or close by?
  • Are there penalties for using an out-of-network ATM?

Many colleges and university have begun to partner with financial institutions to offer accounts to their students. In fact, according to the U.S. Government Accountability Office, 40% of college students attend schools with these types of arrangements.

Some colleges may use official communications, such as email, to market a particular financial institution’s products. Others may allow a financial institution’s staff on campus to promote their products. A college or university may even be paid when a student opens a sponsored account.

It’s important to note these sponsored accounts can come with high fees. As a result, you’ll want your child to be aware that just because an account is sponsored by the college or university doesn’t necessarily mean it’s the best option.

“Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2016.”

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