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Question: What banking services are available for my 16-year old daughter?
Answer: We surveyed two banks, a credit union and the Young Americans Bank in Denver. There are major differences in banking choices for young people, which turns this
decision into a good learning opportunity. Sit down with
your daughter and sketch out a comparison checklist. Then
let your child do the shopping.
Bank A does not offer checking accounts for anyone
under 18. Savings accounts must have a sponsor's or legal
guardian's name on the account. It takes $100 to open an
account. Service fees are waived until age 18. If the
balance falls below $250 after the young person turns 18,
there is a $3.00 per month service charge. The current
interest rate is 1.9 percent APR. Credit cards and car loans
are available with a cosigner.
Bank B offers a noninterest checking account for your
16-year-old. There is no minimum balance, unlimited check
writing and free checks. Savings accounts earn 2.55 percent
interest with no monthly maintenance fee until the young
person turns 18. After 18, there is a $2.00 monthly
maintenance fee for accounts with balances less than $200.
There are three free withdrawals per month. A credit card is
available but it must be in the parent's or guardian's name.
Car loans are available with a cosigner.
The credit union offers an interest-bearing checking
account with unlimited check writing if the account
maintains a $500 balance. A service charge of $5.00 per
month is charged for lower balances. A budget checking
account pays no interest and requires no minimum balance. Up
to 10 checks per month can be written. The regular savings
account requires a $25 minimum balance and earns 2.02
percent. Credit cards and loans are available with
cosigners.
The Young Americans Bank in Denver is the world's first
and the only state-chartered, FDIC-insured commercial bank
for young people under 22. Young people under 18 must have a
sponsor for all services. Noninterest bearing checking
accounts must maintain a $150 balance or a $2.50 month
charge is assessed. Account holders can write 10 checks per
month with no charge. Additional checks cost $.25 each. It
takes $10 to open a savings account that pays 2.27 percent
APR. Four withdrawals per month can be made at no charge.
Members can obtain credit cards and car loans.
For more information, contact your local
Colorado State University Extension office.
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