Healthy spending and saving habits can be developed at a young age. Teens starting their journey to adulthood can begin developing their financial habits by having a debit card. Getting a teen debit account helps them start saving and spending their money wisely and gives you peace of mind. Here are four reasons to get a debit card for your teenager.
1. Your teen has more control of their finances
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Teen banking accounts allow young people to deposit funds into their accounts and learn how to save and grow their money. Some teens have a part-time or weekend job that often requires direct deposit information, so having this type of account lets your teen store their earned funds in one location rather than redeeming their paychecks for cash.
2. Debit accounts can help teach financial responsibility
As the money in your teen’s account grows and gains interest, they might be more motivated to save their money rather than spend it. Teens who have their own debit card can also manage their money and track their transactions. This can, in turn, lead them to be more responsible with their funds. Some topics to discuss with your teen upon opening a debit account include protecting their card’s digits, monitoring for fraud activity, and knowing how to freeze their card. You might also use this new tool to teach them how to budget using a spreadsheet.
3. Joint ownership can help you monitor your teen’s spending habits
Joint ownership allows you to view your teen’s account activity, including their deposits and withdrawals. This helps you oversee your teen’s spending habits without being overbearing or continuously asking them how they’re spending their money. Watching their habits and trends can also help you find ways to talk to your teen about financial responsibility.
For example, do you notice your teen spending more money on eating out or on trendy coffee drinks? Talk to them about how small purchases add up over time and how they can find different ways to still enjoy what they love without spending too much. Account monitoring can also help you determine if there’s any fraud or suspicious activity occurring on your teen’s account, giving you the opportunity to intervene early if there are any unusual changes.
4. High-interest rates can help your teen save for their future
High-interest rates can also result in high dividends from a banking institution. Having your teen save more money in this type of account can generate larger returns. Talking to your teen about their financial future may motivate them to have smart money habits. With an Alliant Teen Checking Account, your teen can benefit from perks such as a 0.25 annual percentage yield and a dividend rate of 0.25%.
It’s never too early to get your teen on track for financial responsibility and healthy money habits. With a teen banking account from a trusted credit union like Alliant, there are no minimum balance requirements or monthly service fees, allowing your teen complete control over their finances.