If you’re a teenager, it can be challenging to open a savings account. If your parents want to help out, they’ll want to ensure that your money is safe in an account with low fees and high-interest rates. But if you’re on your own, there are plenty of ways for teens to save money that they can manage themselves. Here’s how:
Find out if there are minimum balance requirements
Sometimes you need a minimum deposit to open an account. SoFi professionals say, “Accounts needing a higher opening deposit provide extra services.” The minimum balance requirements for a savings account can vary by bank and the type of account. Some banks require no minimum balance at all to open an account, while others require a certain amount in order to avoid monthly maintenance fees.
You’ll want to find out what the requirements are before opening your savings account because if you don’t have enough money in your account, it could get closed without warning or cause other problems with the bank (like being unable to make withdrawals).
Choose the right savings account
As a first-time saver, you should look for a savings account with no fees. You want to avoid being charged for what is already supposed to be free. You also want an account with a high-interest rate so that your money will grow faster and you can afford more things later on.
In addition, it’s important to find an account that provides good customer service and makes it easy for teens like you to use the account on their own by opening an online portal or having mobile apps available.
Decide how you want to fund your savings account.
Once you decide which type of account you want to open, it’s time to start setting up your bank account. You need to decide how you want to fund your savings account. This will be the first step in opening an account with a bank or credit union. There are several ways that people pay for their checking and savings accounts:
- Automatically depositing money from their paycheck into an existing checking or savings account
- Setting up direct deposit into a new checking or savings account
- Paying by debit card at the ATM, through online bill pay services, or by mailing checks
Make sure you can make deposits when and where it’s convenient for you
When choosing a savings account, make sure you can make deposits when and where it’s convenient for you. The best option is an online account that allows you to deposit money from your computer or mobile device, but if there are no branches near your home or school, it might be better to use an ATM card and a bank with nearby ATMs. A checking account will also work if it can withdraw funds at an ATM or at other locations like kiosks.
Find out about the interest rate and terms of the account
Though you may be tempted to choose the savings account with the highest interest rate, that’s not always the best decision. You should also consider the terms of your account. For example, some accounts have low opening fees or offer free checkbooks and debit cards, while others require a minimum balance to open and maintain an account.
Hopefully, this article has helped you navigate the world of savings accounts and make your first one. Remember to pick something that you’re comfortable with and that is easy on your budget, but don’t be afraid to try new things!