Tips for starting your kid’s first checking or savings account.
Helping your child develop essential life skills early on is one of the best ways to prepare them for future success. Financial literacy is especially important, and opening a checking or savings account is an excellent way to introduce them to real-world financial practices. It’s a practical step that can set them on a path to managing their money confidently and independently.
When Should You Open an Account?
Many parents delay opening a financial account for their child until they’re a young adult with a part-time job. By then, however, your child should already have a solid foundation in basic money management.
Financial experts, such as G. Brian Davis of Money Crashers, recommend starting much earlier. “Aim to open a checking account with your child between the ages of 8 and 10,” Davis suggests. “Start simple, tying their income to chores and charging them mock real-world expenses. As they grow older, you can teach them more complex financial lessons like entrepreneurship.”
While the ideal age will depend on your child’s maturity and readiness to learn, it’s recommended to open an account by the time they’re 13 years old.
What Features Should the Account Offer?
The right account can provide your child with valuable learning opportunities. Spencer Tierney of NerdWallet suggests choosing an account with the following features:
- In-person and online access: Allows your child to manage their account conveniently.
- Interest-bearing rates: Reinforces the value of saving money.
- ATM or debit card access: Teaches responsible spending.
- Low or no fees: Avoids unnecessary penalties and helps foster a positive experience.
These features ensure your child gains hands-on experience with financial tools while reinforcing good financial habits.
What Does Opening an Account Involve?
Since minors cannot legally open financial accounts on their own, you’ll need to be a joint account holder. This gives you the ability to monitor transactions, deposit funds, and guide your child through their financial journey.
When you’re ready to open an account, visit a branch with the necessary documentation. Madison DuPaix of The Balance notes that financial institutions typically require proof of legal responsibility, such as your child’s birth certificate, and both of your Social Security numbers.
Encourage your child to bring some of their savings to deposit on the day the account is opened. This allows them to immediately participate in the process and reinforces the importance of saving. Afterward, provide opportunities for them to add money to the account, simulate paying bills, and even make occasional purchases to practice money management.
Prepare Them for a Sound Financial Future
Opening a checking or savings account for your child is more than just a financial step – it’s a teaching moment that equips them with the tools they’ll need to navigate money management, develop wise spending habits, and plan for their future.
Here to Help
At Five Star Bank, we’re here to help you and your family build a strong financial foundation. Stop by one of our branches or connect with us online to learn more about our account options and how we can support your child’s journey toward financial independence.
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