It is important to inform your student of Checking Terminology and helpful tips before they arrive at college.
How to choose a Student Checking account
- Consider what banking options are right for your son or daughter. If ATM use is a must, be sure you're not going to be nickel-and-dimed with fees every time your student is taking out money.
- Find out what happens to your son or daughter's account during the summer months. Can they still make deposits to their account and use the ATM from home?
- Can they write an unlimited number of checks each month, or is there a limit? Does your son or daughter qualify for a debit or check card?
- Will wire transfers into your son or daughter's account cost you hefty fees?
- What is the monthly service charge? Can your son or daughter visit a teller without being charged?
- If your son or daughter leaves school, how easy is it to transfer or close your account?
- What happens to their account when they graduate?
- Are there branches and ATM machines convenient to campus and where you live?
Many students as they arrive on College campuses do not know the basics of banking such as depositing cash/checks or even writing a paper check to pay bills. It is important that you or the bank your son or daughter selects for their student checking account goes over all the basics of banking. Always record your deposits, transfers, ATM withdrawals, and debit card transactions as soon as you make them.
You should have your son or daughter's bank show them how they can deposit cash or a check (at the branch and at the ATM). Make sure they go over how to fill out a deposit slip and why they should keep their account number private.
If your son or daughter does not know how to fill out a check make sure you and the bank also cover this. Make sure the bank goes over their Internet banking features. Outlined below are 4 steps that your son or daughter should understand in order to balance a checkbook:
Balancing your checkbook in 4 easy steps
Step 2: Add any deposits that you have recorded in your check register but that are not on this statement.
Step 3: Subtract any outstanding checks (checks you have written but that have not yet cleared the banking system).
Step 4: Compare the result with the current balance in your check register.
Student Checking Tips
- Remind your son or daughter that, when they shop for checking accounts, they should consider the required balance, monthly fees, interest earned, cost of printing checks, and charges for other fees and services. As electronic banking services expand, make sure your student is aware of the services available via the Web.
- Always record your deposits, transfers, ATM withdrawals, and debit card transactions as soon as you make them.
- Always fill out the register BEFORE you write the check. That way, you won't be caught short with the wrong balance, trying to remember what check's you wrote.
- Many banks have online banking that can help you better manage your money. Some allow you to view your accounts online and even pay bills electronically.
- There are many differences between financial institutions and the services they offer, including the specifics of checking accounts. Here are some things to consider when shopping for a checking account:
- Location
Availability of ATMs
Nearest Branch Offices
Hours of Operation - Fees
Monthly Fees (Balance Requirement)
Per Check Fees
Balance Inquiry Fees
ATM Fees - Other Charges
Overdraft Charges
Stop-Payment Fees
Certified Check Fees - Restrictions
Minimum Balance
Deposit Insurance
Holding Period for Deposited Checks - Special Features
Direct Deposit
Automatic Payments
Overdraft Protection
Online Banking
Discounts or Free Checking for Students
When you open a checking account you can expect the bank to include a debit card or, as some banks call it, a check card. These cards give you additional flexibility when it comes to paying for purchases.
Traditional ATM cards only allow you to withdraw cash or perform other transactions at an ATM by using a secure PIN. Debit cards let you pay for purchases in stores. The money is taken directly from your account. There's no "pay later" option with debit cards.
The Benefits of a Debit Card
- Payment convenience and safety. You don't have to carry a bulky checkbook or large sums of cash when you go out shopping.
- Wide merchant acceptance. Debit cards are more widely accepted than checks - even when you travel - and let you make Internet purchases.
- Fast, easy payment process. There are no checks to write, and no need to present an I.D. or other personal information at the sales counter.
Important Reminders for Debit Cards
- Keep your PIN private. Memorize it. Don't write it down and never tell it to anyone.
- Make sure that you have easy access to ATM's owned by your bank. Withdrawing money from an ATM that is not owned by your bank (a "foreign" ATM) will result in two fees per transaction. The first fee will be a "surcharge" from the ATM's owner and the second fee will be from your bank. If these fees are $2 per transaction and your son or daughter makes 2 transactions per week, $208 in transaction fees will be billed annually.
- Know your current account balance. Don't forget about checks that have not yet cleared your account.
- Always take sales receipts and carbons. They may contain valuable information a thief could use to make mail, phone, or Internet purchases on your account.
- Record your transactions in your check register as soon as possible. Remember to include any debit card fees that may apply. Then store your receipts safely in one place in case you need them later.
- If your card is lost or stolen contact your card issuer immediately. This reduces your liability if fraud losses occur.
Deciding when to use your debit card and when to use your credit card isn't a frivolous decision. A credit card is a "buy-now, pay-later" tool. A debit card is a "buy-now, pay-now" tool. Both cards can play major roles in your money-management plan.
A debit card is linked to your checking and/or savings accounts, in banking terms, "deposit accounts". When you use a debit card, money is subtracted from your deposit account, generally a checking account. In contrast, a credit card is an unsecured loan that a financial institution provides to you as a payment convenience. Using a credit card means that you intend to repay the amount - plus interest if you do not repay the balance in full each month.
