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How Youth Checking Accounts Build Financial Responsibility

Help your child or grandchild start a pattern of savings. Review options for youth investors via Fresh Insights and Cadence Bank. Learn about youth investing.

If your child is ready for the responsibility, consider opening a teen checking account. Many teenagers need a place to deposit their paychecks from part-time jobs, plus it's important to set up your child with the proper tools and right financial mindset before leaving for college. Involving them as much as possible in the process of setting up their teen checking account will also help them down the road when it's time to upgrade their checking account.



Find Youth-Friendly Features

These key elements will help fit banking into their daily lifestyle to help budget their allowance, track their spending, and more.



Mobile and Text Banking

Teach your child that there's more to their cell phone than Instagram and other social media apps. Several banks offer mobile apps with push notifications to receive information about their account balance, the ability to deposit checks and make person-to-person money transfers. You can also sign up for special text features to check recent account activity and avoid potential overdraft fees. 




Person-to-Person Payment Apps

Person-to-person payment apps like Venmo and PayPal are becoming more popular among teenagers rather than paying each other with cash. You and your child should review the the security features and fees involved in these apps before your child links their checking account or debit card to the app, since your banking information is linked with theirs. Some financial institutions also have their own P2P payment apps.
Your child can also link their debit card information to services like Apple Pay and Android Pay to use in participating stores. These technologies have a security layer that prevents their card number from being involved in their transaction, but instead a one-time code.




Cadence TotalMoney

TotalMoney gathers and organizes all of your accounts and transactions into one place to track all of your daily spendings and alert you when your attention is needed. You can also have access to simple charts that allow you to see spending patterns. TotalMoney can be a useful tool for you and your teenager when teaching them how to spot patterns in their spending habits and budget their allowance. Plus, since TotalMoney is accessible on a laptop, tablet or mobile device, your child can access TotalMoney wherever they are.




Watch Out for Fees

At the beginning, this account is supposed to be an educational tool and doesn't need to be fancy. Keep the account simple and don't sign up for an account that requires a monthly maintenance fee or requires a minimum balance. Also, try to find an account that offers free checks to eliminate the extra cost, and teach your child how they should be used.
Avoid overdraft fees by teaching your teen to get in the habit of checking account balances. If possible, set up the account so if your child tries to purchase something, but doesn't have enough funds in their account, the card will be declined. Youth checking accounts can also have overdraft protection where the checking account will be linked to a savings account or credit card (most likely yours) to cover the expense.



Understand the Responsibility 

Opening a youth checking account means that you are opening a joint account with your child. Since you are also a co-owner, you are responsible for the financial burden, overdraft charges or any expenses from the account. Make sure your child understands that it's not just their finances, but yours too, at stake.
As a parent, it's your job to make sure your child's money is safe and they have the best possible teen checking account. When doing your thorough research, consider asking the following questions:
Does the account come with spending limits?
Can a parent set other restrictions?
Do I also need to have an account at the financial institution?
What happens when my teen ages out of the account?


Even after you and your banker educate your child on how to track their spending and budget their finances, some lessons have to be learned first-hand. This is why it's important to choose the right youth checking account to minimize any possible fees and expenses.
Ready to set up a checking account for your child? Contact Cadence Bank to help set up the account and educate your child on financial responsibility.

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