When is the right time to open a bank account for your teen? Can a 13 year old have a bank account? What about a savings account for kids? These are all important questions parents of teens and preteens want answers to.
Putting away money for college and teaching teens good financial habits are certainly important to-dos for parents and kids. However, a kids savings account can become a challenge, especially if your teen is already making cash from allowance and a side hustle.
Kids are also pretty savvy. They live in the most technologically advanced era ever. Setting up a savings account for kids can be a great way to get the financial wellness ball rolling in the right direction.
You can even pair a kids savings account with a financial app for kids like Treasure!
Learn more about how the Treasure financial app for kids can track balances and move money around in savings, spending, and goal accounts. It is a hand-on app kids and parents love.
In the meantime, let’s take a deeper look at savings accounts for kids and answer the common parent and kid question, “Can a 13 year old have a bank account?”
This is a great question we get from parents all the time. Since Treasure, our financial app for kids, has savings and spending accounts, parents want to know how old their kiddos need to be to use it effectively.
This aligns perfectly with can a 13 year old have a bank account. Most banks allow teens to get a bank account at age 13. However, it may be better to get those financial milestones moving earlier on.
Many kids begin receiving allowance by 5 years old, according to a T.Rowe Price study.
Most kids started getting an allowance after the age of 11. But there were a large number of kids who did begin earning allowance by 7 years old, noted the study. This would indicate that by at least preteen ages, your kid can get a savings account.
When it comes to getting a savings account for your 13 year old, you will need to do a bit of parent due diligence. There are a ton of savings accounts for kids, and choosing the right one is important.
For example, Bank of America has two different types of savings accounts for kids. The difference between the two is all about the parental control you have.
A Minor Savings Account allows your 13 year old, or preteen, to access funds before he or she is 18 years old. This is simply a joint account.
The Custodial Savings Account gives parents the control, limiting what teens and preteens can do, like withdraw funds or make bank transfers.
The banking options available for savings and checking accounts really depend on the financial institution you go with. The first best step is to give your current bank or credit union a call and discuss what they have to offer.
Financial wellness and instilling good saving habits and spending habits needs to be a family affair. Many parents remember heading into the bank with mom and dad to set up their first bank account. It was a right of passage in a way for kids back in the day.
However, the current COVID-19 pandemic restrictions for going to set up an account in person may limit options for in-person bank account setups.
It may not be as memorable for kids, but you and your 13 year old can still set up a bank account together online. And having the financial wellness talk before and after doing this is important.
Downloading a financial app for kids is also a great starting point. For instance, Treasure is a financial app for kids that acts as savings and debit accounts. Treasure users will soon have access to the Treasure debit card, making banking as real as going through a financial institution.
The answer to this question is absolutely. Your teen can certainly benefit from having a bank account. And many studies have even recommended starting preteens off with savings accounts too.
As a parent, you will need to make the decision. But setting up your kiddo with a financial wellness plan early on can be beneficial for great saving habits down the road. Even into adulthood.
Is your 13 year old ready for a bank account? Discover Treasure and get those kiddos off to a healthy financial start.