How Old Do You Have to Be to Open a Bank Account?

Written by Banks Editorial Team
5 min. read
Written by Banks Editorial Team
5 min. read

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Opening a bank account represents a step into independence. You get more control over your finances and can learn more about money. You can read a textbook or watch videos, but experience is one of the best ways to learn about money. However, banks won’t let anyone open up a bank account. Adults can open a bank account by themselves if they are 18 years or older. Minors between 13 and 17 years old can open a custodial or joint checking account if their parents oversee it. 

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The Importance of Managing Your Finances Early On

You don’t have to own a bank account to make money and use it for purchases. However, a bank account is extremely convenient and insures your money. If you pick the right bank, you could also get noteworthy perks such as 4% APY on your savings account and overdraft protection of up to $200. 

Teens can create bank accounts on their own when they turn 18. However, teens can open bank accounts a few years earlier with their parent or guardian’s oversight. Pursuing this route introduces teens to money at a younger age which has several benefits.

Learn the Value of Financial Literacy

Money impacts many parts of our lives. For example, a person’s surplus or shortage will determine where they live because of rent payments and mortgages. The place you live can impact who you surround yourself with, your career opportunities, who you marry, and where you get to raise your children if you choose that path. Money also impacts your ability to go on vacations, cover emergency expenses, and make holiday purchases.

Money ultimately gives us more choices. The more money we have, the more flexibility we have in our lives. Financial literacy helps us understand these lessons and how to harness our finances to fortify and preserve wealth

Instill Fiscal Responsibility

Giving your child a bank account can help them value money and become more fiscally responsible. You can set a budget for your child and have them allocate the funds as they desire. It’s fine to spend money on yourself, but you must do it in a responsible manner. Learning these lessons early and with very little money will prepare you for the days when you make more money from your career. A high-paying career won’t help your finances if you spend everything that you make. Instilling fiscal responsibility at an early age makes your teen less susceptible to critical money mistakes later in life.

Road to Financial Independence

Financial independence occurs when your passive income exceeds your expenses. Earning income and putting it into cash flow-producing investments gets you closer to financial independence. Creating a bank account early also opens the doors to investment opportunities. You can transfer funds to a portfolio and make monthly contributions. If you want to invest in crypto, you can do so right from the Current app. You don’t have to worry about creating a brokerage account on a separate platform to invest in crypto with the Current mobile app.

Investing earlier gives you a significant advantage on the road to financial freedom. Investments you make in your 20s have multiple decades to compound by the time most people would consider retirement. Starting your journey later is better than not starting at all, but you don’t get to take advantage of compounding growth stretched over a longer timeframe.

Better Chance of Financial Success

Learning about money at a young age increases the probability of financial success, similar to becoming a professional athlete. The aspiring pro athlete who started playing seriously at five years old has a better chance than the person who picked up the sport as a 20-year-old. Athletes who started earlier have more time to develop their bodies and learn the nuances of their sport. The same concept applies to finances. An earlier introduction to finances can set your teen up for greater success in the future. They will learn and make mistakes with small sums of money and set financial goals for themselves.

How Old Do You Have to Be to Open a Bank Account?

You can open a bank account at 13 with a parent or legal guardian as your custodian. Anyone 18 years or older can create a bank account without parental supervision. 

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Earn 4.00% APY on your savings. No overdraft fees/hidden fees. Get paid up to two days faster with direct deposit. Earn up to 15x the points on swipes.

Is There Banking Specifically for Teens and Young Adults?

Most financial institutions let parents create bank accounts for their teens. These accounts let young adults make deposits and withdrawals. Then, when the account holder turns 18, they can gain more control over their finances.

However, a bank account isn’t enough to teach financial discipline. A bank account designed for teens and young adults can accelerate their financial growth and teach valuable money lessons. Current Teen Banking is one solution. The app lets you monitor every purchase and set limits on how much your teen can spend each day. These features let you stay on top of your young adult’s finances and help them stick with a budget.

Bank accounts for teens and young adults should balance financial flexibility with safety brakes that teach them how to effectively manage their money. Unfortunately, custodial accounts with traditional banks don’t always provide this experience. If you want your teen to have the best possible banking experience, you should give them an account specifically for them.

Should You Get Your Child a Bank Account?

We have established that your child can open a bank account upon turning 13, as long as you are their custodian or open a joint account. It’s natural to wonder if it’s worth opening another bank account for your child or waiting for the 18th birthday to get started. Setting up a bank account for your child has many benefits. 

Your child will learn about money through experience and value their savings. A bank account makes it easier to generate and store wealth. You can invest some of your funds into assets that generate cash flow and compound over time. A bank account also makes your child feel more independent about their money and will get them to take their finances more seriously.

How Do You Open One, and What Are the Typical Requirements?

Opening a bank account for your child is a great gift. You will start your child on the journey to financial independence and help them learn about money. Before opening a bank account, you should compare accounts across banks, credit unions, and other institutions. Don’t stop at traditional banks, as online banks often provide better perks and lower or zero fees. 

You will need the following documents to create a bank account for your child:

  • Your driver’s license
  • Child’s birth certificate
  • Child’s social security number
  • Verification of your home address

Some banks will require you to show up in person with these documents, but you don’t have to worry about this extra step with an online bank. After assembling the necessary documents and submitting an application, you will have to make a deposit into the account and activate the debit card when it arrives by mail. Some banks provide a virtual debit card while you are waiting for the physical card to arrive. Your child will not have to pay taxes on their savings account unless they exceed $2,100 per year in unearned income (i.e., dividends and interest).

Get a Better Banking Experience Built for Teens

Young adults can have more prosperous lives in the future if they open a bank account during their teen years and learn how to manage money. Of course, they can understand the value of saving and investing, but some bank accounts reinforce these lessons better than others. A Current Teen Bank account is one of the best choices for parents who want to introduce their children to financial management.

Current aims to make both groups happy. Teens get financial independence, while parents can add protective features to their children’s bank accounts. Teens will receive a debit card tied to their bank account, which will help them make purchases online and in retail stores. They also get access to savings accounts with 4% APY. Most banks have low-interest rates on their savings accounts. Unfortunately, these low rates do not incentivize saving as much as the higher interest rate you’ll find on Current. 

Parents can also rejoice, as the app lets them track spending and block merchants they don’t want their teens going to for business. You can transfer money to your teen’s account, limit their daily spending, and automate allowance payments for completed chores. Current does not charge a subscription or hidden fees for these accounts. 

Current isn’t only great for teens, but it’s also become a popular online banking destination for adults. Over 4 million people use Current to get overdraft protection, gas hold removals, spending insights, and other services. Current has valuable resources and features for everyone in the family.

You can create a Current account by visiting their website or downloading the mobile app. It takes less than two minutes to set up your account and have a superior banking experience.

Sign up for Current - The future of mobile banking
Earn 4.00% APY on your savings. No overdraft fees/hidden fees. Get paid up to two days faster with direct deposit. Earn up to 15x the points on swipes.

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