This Is Why Your Kid Should Have A Savings Account (And How To Open One)
If you are a parent, you want to see your kid get a foothold in life and flourish. You have an easy and effective way to help them do so. Finance is one of the most important aspects of life.
And teaching your child how to handle them is a basic lesson that you need to give them. Getting them to open a savings account at a young age is an effective way to become financially responsible.
A custodial account, like UTMA or Uniform Transfers to Minor Act accounts and UGMA or Uniform Gifts to Minors Acts accounts, is probably the best way to learn how to manage money. There is more to this, and the following points might give you a proper overview of this.
Always Open a Savings Account
Many parents might be unsure about opening a savings or a checking account for their children. The purpose of checking accounts is to spend money, and you need to teach your kid how to save money. However, wait until your child starts working or is a teenager before giving them complete access to their checking account. When you open a savings account for your son or daughter, you might have to furnish your kid’s identification documents.
Talking about Wells Fargo, your child must have a driver’s license or have an adult with them who has been their customer for at least two months. Besides that, you should provide anyone out of the list of documents. This includes a school id, immunization record, birth certificate, and a Social Security card.
Make Your Kid Visit a Physical Bank
Even if your kid happens to be quite tech-savvy and is conversant with basic online banking, they need to visit a physical bank to learn the correct banking etiquette. Allow your child to hand over his or her babysitting money and store the receipts safely while keeping track of how the deposits are accentuating with time.
By the time your child attains adulthood, they will opt for the banking method which suits them. But, when they are young, having a tangible experience of communicating at a physical bank and getting involved in it is necessary.
Opt For a Bank That Promotes or Imparts Financial Education
Hopefully, the importance of having a savings account for your child is clear to you by now. Now, certain financial institutions impart some valuable money habits to the kids and make savings an entirely fun process. You can ask a banker for help and scroll through the bank’s website to find out if they have money tutorials for the children. You can also come across substantial information on the Consumer Financial Protection Bureau website.
It’s a financial regulatory as well as an education agency. Some financial institutions that cater to what you are looking for are the Bank of America, Allianz Credit Union, Capital One, Bethpage Federal Credit Union, USALLIANCE Federal Credit Union, Golden 1 Credit Union, and of course, Wells Fargo.
Never Forget Saving For Your Kid’s College Education
A majority of the parents tend to hurry as far as saving money for their kid’s education. According to estimation, the average cost that a parent might have to incur is something in the ballpark of $10,230 for a public institution. In contrast, the cost may go up to something in the close proximity of $35,830 for a private institution. There exist several ways through which you can build up your savings for those days. Choose any one out of a 529 account, ESA or Education Savings Account, or UTMA/UGMA accounts. Irrespective of whatever financial objectives you might have for your kid, learning about money can always be fun.
Every parent wishes to see their off-springs succeed in their lives and get serious about money. Before making them financially independent, you have to learn the basic nuances of handling money and, realize the importance of savings. Allow them to gain some practical experience, to deal with money matters all by themselves when they grow up. This way, they will grow up to be responsible adults who can handle their finances well. However, if you keep them away from money discussions and not train them to save early in life, they might face challenges as an adult. You could consult a financial advisor on tips to teach your child about money and saving is necessary.
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