There’s a lot to do when a child is preparing for college – choosing dorm essentials, figuring out a meal plan, packing up for move-in day…the list goes on. In the middle of all this, college bank accounts may seem like an afterthought. But, the truth is that opening a college checking account is one of the most important things to do before heading to campus. If your child does not have a bank account – or has been relying on you to help cash checks or receive payments – it’s time for him or her to start managing their own finances. Online banking and mobile apps make it easier than ever before for college students to monitor their bank accounts, but it’s still important to know exactly what to look for in a bank. If you’re not sure how to help your child find the right accounts, this guide is a good way to get started.
Why should a college student have a bank account?
If your son or daughter has never worked a part-time job or had another steady source of income, he or she might not have needed a bank account during high school. Even if you’re helping with costs or have taken out student loans, a college bank account is still a good idea. This is especially true if:
- You want your child to have easier access to student loan payments, tax refunds, work-study payments, etc. A college checking account makes it far easier to access payments your child may receive from employers or via student loans. In fact, many institutions have direct deposit options so payments go right to your child’s checking or savings account. No need for the student to check the mailbox constantly or worry about losing an important check!
- You want your child to experience financial flexibility. Most college checking accounts come with both check and debit card options – perfect for making larger payments (like rent and utilities) and for smaller purchases (like groceries or textbooks). A debit card also lets you withdraw cash from ATMs 24/7, which is perfect for quintessential college experiences (like late night calzones with new friends).
- You want to make bill payments easier for your child to handle. In addition to checks and debit card payments, some college bank accounts allow account holders to set up one time or recurring bill payments. Not only can this save time and frustration – no more mailing checks and hoping they arrive in time – but also, automatic bill payments can help your child establish a regular payment history, which can help his or her credit score.
- You want to help your child’s financial literacy. “Can you afford to go out on Saturday night?” Instead of coaching your child through every saving and spending decision, a college checking account allows him or her to double check their balance online or with their mobile app. The ability to immediately check an account balance isn’t just a convenience – it’s also a great way for your son or daughter to learn where their money is going.
- You want your child’s money to be safe and secure. It’s always good to have some paper money on hand, but you probably wouldn’t feel comfortable with your child carrying all of their money with them or storing it in their dorm room. When your son or daughter is away at college, a bank account can give you (and them!) added peace of mind.
What to look for in a bank
Your child’s school may encourage banking with a specific institution on campus. However, this bank may not be the best fit for their needs. Instead, look for a college bank account with features that make it easy to manage money both on and off campus, such as Santander’s Student Value Checking account. While everyone has different needs, you may want to consider the following points before helping your child open a college checking account:
- Features: When researching college student bank accounts, take a moment to compare features and decide which ones your son or daughter may need. Some student accounts only offer the most basic options, while others feature mobile banking, paperless statements and online banking options like setting up transfers or automatic bill pay. Some students may also appreciate the ability to set alerts and reminders for their account. Make sure the account you both choose, fits his or her lifestyle!
- Fees: Some bank accounts come with monthly maintenance fees. While these fees may seem small, they can be tough for students to manage if they’re on a tight budget. To avoid paying extra for a college checking account, be sure that the account your child chooses does not have any recurring fees associated with maintenance, a minimum balance or other terms. Also, see if a potential account will alert you and your child if the balance gets too low – it’s a simple, easy way to avoid overdraft fees.
- Benefits: In addition to researching features and fees, try to find a college bank account with perks that can make life a little easier for your young college student. Options like mobile pay access, mobile deposit and no minimum balance requirements are may seem basic, but they can make money management a lot easier. Depending on your bank, you may also be able to link the new checking account to a savings account.
- Location: Even if the account doesn’t have monthly fees, your child can still get hit with charges if he or she uses an out of network ATM. That’s why it may be important to find a bank with in-network ATMs on or near campus. If you plan to open a joint account with your child, you’ll need a bank with branches in your hometown and their college town to make banking more convenient for everyone.
When should your child open a college checking account?
It may be tempting to have your child wait until he or she is on campus to open a bank account. After all, aren’t there more important things to do right now? The truth is, your son or daughter may find it much easier to transition into the life of a college student if they have a bank account before they arrive. Best of all, both of you will have more time to research your options and find the perfect college bank account for your needs. If you have questions or need help finding an account with the right features, visit your local bank or nearest Santander branch to speak with a personal banker.