Teenager's first checking account

[Uncle Leo]

Teenage son (17) will be opening his first checking account today. Most likely, it will be a joint account with me on it, also. I'm not real thrilled with that, but we will be opening at a bank that I have no affiliation with as I will NOT stand for a bank dipping into one of my accounts to cover a debit in another. Been there, done that, ain't happening again.

 

Ok, anyway, here's my conditions for the youngin'...

 

- He gets a checking account with a debit card. I could go for a savings account with a basic ATM card, but I want him to learn the concept of credit-type transactions along with managing money and staying within his means, while still learning the convenience, how and why to avoid debit fees, etc. (No, AU on a credit card is not an option, and will not be considered. On principle, I don't believe in the concept.)

 

- He agrees that I have access to all records (statements, etc) at all times.

 

- He agrees that he and I will sit down once each and every month and balance his statements.

 

- He agrees to keep track of his spending and receipts. (I know this one may fall by the wayside... he is a teenager, after all)

 

- No checks.

 

- Any negative balance will be #1 priority before any other spending.

 

- I reserve the right to close the account should I feel that it is on the verge of being closed for negative balances.

 

Am I being unreasonable? Anything I might have missed?

[JessieLyn]

I would say keep checks but, only for emergencies or for something he'd have to use them for (ordering, who knows...)

 

Try to get him to write down his daily transactions as they happen including fees/surcharges and such. Um... Sit down once a week and go over it with him and compare to the online statement and make sure he didnt miss anything and is balancing correctly.. then after he seems to get it going good switch to a month?

[maporsche]

I think that I would also encourage him to open a saving account with the same bank and I would teach him to 'pay himself first' by depositing at least 10% of whatever he makes into savings. That is a habit you couldn't learn to early.

 

I would also keep the savings account attached to the checking so he can learn to have that level of self control (having the money only a few mouse clicks away, but the self control not to use it).

 

My $0.02

[BBQ123]

Checking account with no checks? Seems to defeat the point of a checking account.

 

He agrees that I have access to all records (statements, etc) at all times.

 

Good idea.

 

He agrees that he and I will sit down once each and every month and balance his statements.

 

Better to have him balance it himself -- make him keep track of the account. Maybe teach him how to use online banking and Microsoft money? Or go the old fashioned way (pen and register).

 

He agrees to keep track of his spending and receipts. (I know this one may fall by the wayside... he is a teenager, after all)

 

Give him a folder to keep all receipts for the month. Also you might want to tell him to not use cash anymore. Exclusively use the Visa check card so you can keep better track of spending.

 

Any negative balance will be #1 priority before any other spending.

 

Uh... never let the account go negative... then you get NSF fees and such.

 

I reserve the right to close the account should I feel that it is on the verge of being closed for negative balances.

 

Once again... do NOT let the account get to that point. Don't want to be in Chex at the age of 17!

 

 

I got a checking account with Visa check card at age 15... I never had it go negative, never had a NSF fee, never had a bounced check, and only once did I pay an ATM fee (always used Visa check card). It's really not that hard to teach teens how to manage money.

Edited June 23, 2006 by BBQ123

[Uncle Leo]

Just got back from opening his account. Except for me being irritated because they checked EQ "for my protection..." (let's not go there), it went smoothly.

 

I think that I would also encourage him to open a saving account with the same bank and I would teach him to 'pay himself first' by depositing at least 10% of whatever he makes into savings. That is a habit you couldn't learn to early.

 

I would also keep the savings account attached to the checking so he can learn to have that level of self control (having the money only a few mouse clicks away, but the self control not to use it).

 

My $0.02

 

I thought about this, and we may still do it.

 

 

Checking account with no checks? Seems to defeat the point of a checking account.

 

Been to a record store lately?

 

He agrees that he and I will sit down once each and every month and balance his statements.

 

Better to have him balance it himself -- make him keep track of the account. Maybe teach him how to use online banking and Microsoft money? Or go the old fashioned way (pen and register).

 

That's what I meant, that he would do it and I would teach/help. The first few times would be pen (pencil?) and register. Just so he knows how to do it in a pinch. I'm a big believer in knowing how to do something manually first. I signed him up for online banking, and we'll move to eltronic methods pretty quickly.

 

He agrees to keep track of his spending and receipts. (I know this one may fall by the wayside... he is a teenager, after all)

 

Give him a folder to keep all receipts for the month. Also you might want to tell him to not use cash anymore. Exclusively use the Visa check card so you can keep better track of spending.

 

We've already touched on using the card as a credit transaction... to avoid POS debit fees as much as anything else.

 

Any negative balance will be #1 priority before any other spending.

 

Uh... never let the account go negative... then you get NSF fees and such.

 

I reserve the right to close the account should I feel that it is on the verge of being closed for negative balances.

 

Once again... do NOT let the account get to that point. Don't want to be in Chex at the age of 17!

 

The bank lady made it a point to show him the NSF fees... $28.50 per pop... his eyes got big.

[TxQuiltGirl]

Hey, play, I would sit down with him for the first few weeks at least once a week and go over with him what he's spending and to ensure that he's not in the red. You should probably teach him the importance of always knowing what he has in his account, so once a month may not be often enough.

[54regcab]

Why not just wait and let him open his own account when he turns 18?

[roddysmom]

Hello!

 

I'm sorry that I missed this when you first posted!

 

My son, Taylor, opened his checking & savings account with BofA the day he turned 16. We had to have my name on it - and I didn't have any pulls on CR's because we already have a C & S account with BofA.

 

He split his Birthday money in half and put 1/2 in each account.

 

1. He got a job the day after he turned 16 flipping burgers at McD's.

 

2. He refused to get an ATM card - and BofA would not issue him a debit Visa card until he turned 18. He said that if he had the ATM he would use it unwisely. Having to physically drive to the bank and get the money would discourage him from withdrawing.

 

3. We set up online access when we got home. I insisted that I have access to this account until he turned 18. I would go in and check his balances about once a month. If I saw too many withdrawals, I'd question him on it. However, it was his money he made working so unless the withdrawals were excessive, I usually let him make his own decisions regarding spending.

 

4. He bought his own car from our mechanic. He had to pay 100.00 a month toward his car insurance. (his car ins. is 3K per year). So, he would transfer 100.00 on the first of every month directly into our checking account.

 

5. He also did not get checks, but that was his choice - unless BofA wouldn't give him any at age 16 (can't recall).

 

Between his 17th & 18th birthdays, I checked his account probably 5 times, as he proved to be extremely responsible with his money. Trust earned you could say.

 

He just turned 18 on June 8th. I told him to make sure he gets the paperwork to remove me from his account.

 

He still refuses to get the Debit Visa card.

 

He had 2500 in his savings and 400 in his checking.

 

He opened an ING account and moved all but 50 over to the ING.

 

He is opening and is researching the ROTH IRA to get it opened before college this Fall.

 

He's been working for the past 6 months at the hospital as a pharmacy runner earning 10.60/hr.

 

He just applied & received his first CC it's a 700 limit with the BofA Student Visa. He keeps it at home, and only uses it to put gas in his car. In fact, he takes the card with him, puts gas in it, then drives BACK home to put the card in his jewelry box. (so, as he says, he won't be tempted to use it).

 

~~~~~~~~~~~~~~~

 

Now, how did we get such a money conscious kid? I have absolutely no idea - but, I believe it has come from him watching us struggle. From me having to say "We Can't Afford It". He vows he will be a millionaire by his first class reunion.

 

I think trust is a big factor in a son or daughter having a checking and savings account. I think that kids should have to work to put their OWN money in the accounts. I also don't believe that parents should bail them out. If, for example, your son bounces a check, or has a negative balance - then the simple fact is "hey son, the next few weeks, maybe you should be working a few more hours, doncha think?" - and that's the attitude I used with Taylor.

 

I'm sure your son will be fine with everything. Give him the rope - it's up to him on how far he pulls.

 

KH

[BBQ123]

Around here BOA issues Visa Check cards to kids in middle school (13 years old or so)... and checks. \

 

Anyone under 18 the account must be joint with a parent, and the checks will have both names. Also they will send 2 visa check cards (one for parent one for child). I got a checking account at like age 15... with checks and Visa Check card.

 

As for waiting until 18... then it is too late. At 18 you can get credit cards and if a kid can't manage a debit card by then credit may be a problem to manage since it can lead to early debt.

Edited June 25, 2006 by BBQ123

[BBQ123]

We've already touched on using the card as a credit transaction... to avoid POS debit fees as much as anything else.

 

 

Did you teach him about the importance of SIGNING THE BACK OF THE CARD?

 

And...

 

No id on signed cards

no minimum

no maximum

no fees!