Starting your teen off with banking

What’s almost as scary as your teen learning to drive? Your teen with money.

Maybe scary is too strong a word. But as with most endeavors where our children move into independence, there’s some trepidation. Have they learned the lessons we tried to teach them? Will they be mindful?

One rite of passage includes the teen checking account, their first foray into handling money on their own … or semi on their own. If your child is under 18, you’ll likely have to be a joint owner; you’ll be able to monitor transactions and access accounts.

Other options include getting your teen a prepaid debit or credit card.

You could set up an allowance in a checking account into which the teen can also deposit income from work. They can then use a debit card to pay their expenses.

A prepaid credit card will avoid the need for a checking account, but also not teach a teen how to use an account.

Some of the things you’ll have to teach your teen.

* How to write a check. We all sometimes need paper. Still.

* Interest rate and monthly fees.

Some accounts have fees and if your account has them, teach your teen when they apply.

* Overdraft fees and overdraft policy.

Teens must not overdraft their account and, if they do, fees will quickly eat up a teen paycheck. You might want to monitor a teens checking account to make sure they haven’t overdrawn.

Teens have to understand that overdrafts and fees can’t be ignored.

* Mobile Banking. Teens are going to use their phone.

* Text alerts and email can be sent to both the teen and parents.