Dec 2, 2022
How old do you have to be to open a bank account?
- In most cases, you need to be 18 years old to open a bank account.
- Minors can still open an account with the help of a parent or guardian.
- A bank account is a very useful tool for establishing good money habits.
To have a bank account is to learn a vital part of managing personal finances. When kids upgrade from a piggy bank to a real bank account, they take a significant step toward learning valuable money skills.
But how old do you have to be to open a bank account? Can a minor have a debit card, a bank account, or even an investment account?
In this guide, we’ll explain the minimum age for a bank account, plus tips on how minors can open an account with the help of a parent or guardian.
How old do you have to be to open a bank account?
In the U.S., you need to be 18 years old to open a bank account on your own.
Why is this? Well, when you open a bank account, you need to sign a legal contract, and an individual must be the “age of majority” to sign a contract. In most states, the age of majority is 18.
This minimum age requirement applies to most financial account types. Checking and savings accounts, brokerage accounts, and even credit cards all require the same minimum age of 18.
Fortunately, there’s still a way to get started for those under 18 years of age: You just need the help of a legal adult!
Minors can open a bank account with the help of an adult.
A legal minor (under age 18) can still open a bank account, but they will need the help of an adult.
Some banks require the adult to be a parent or a legal guardian, while others simply require that they be over age 18. So in some cases, a grandparent or family friend could help.
How does this all work? Essentially, the adult can open an account on behalf of the child and add the child’s name to the account. Both parties become co-owners of the account.
How old do you have to be to open a bank account with the help of an adult? This varies by bank — some have no minimum age requirement, while others may require the child to be 7, 10, or even 14 years old.
In most cases, the adult maintains legal control of the account until the child comes of age, but the child has shared access to the account.
Bank accounts for minors 🏦
There are a few different methods to consider:
Joint checking accounts: The adult and child become joint account holders and can each make deposits, withdrawals, and purchases as needed. Some banks may have a minimum age for joint accounts (14 years old is common), while others have no minimum. These accounts are available from local banks and credit unions.
Joint savings accounts: The adult and child share the account and can make deposits and withdrawals as needed. Purchases are more restricted, as savings accounts typically do not come with a debit card. There generally is no minimum age requirement for the child.
Teen checking accounts: Teen checking accounts are available for those ages 13-17. They offer many features of a standard checking account and often convert into standard checking accounts once the teen becomes an adult. Teen accounts still require parental approval, however.
Kids banking apps: Specialized money apps for children provide a tech-first alternative and are often a better choice for families. The child can have their own account (opened with parental approval) that the adult can monitor and set limits on. Children receive a debit card for everyday purchases, while parents can customize parental controls on the account. Usually, there is no minimum age requirement for these apps. If this sounds useful, keep reading to learn more about Greenlight.*
The types of accounts above are the best ways to learn about traditional banking terms or experiences. For more specialized savings goals, there are other account options.
Custodial accounts for minors 💰
Custodial accounts work a bit differently and are not traditional bank accounts. Most are investment accounts designed for specific savings goals — like college or even retirement. They typically don’t have a minimum age requirement but may restrict how you use the funds.
With a custodial account, the adult serves as the “custodian” and manages the account for the child. The child is added as the “beneficiary” and becomes the primary account owner once they become an adult. Some examples include:
UGMA/UTMA accounts: These similar account types enable adults to start investing for children. UTMA stands for Uniform Transfers to Minors Act, while UGMA stands for Uniform Gifts to Minors Act. Parents primarily use these for investing in stocks and other assets and do not have the same features of a checking or savings account.
529 college savings plans: 529 savings plans are a specialized type of custodial account designed to help parents save for their children’s future education. The adult can open an account and name the child as a beneficiary. The plans offer generous tax perks, but only if funds go toward qualifying educational expenses.
Custodial retirement accounts: Custodial retirement accounts, like a custodial Roth IRA, let teens save money towards their eventual retirement. They offer generous tax perks too, but there are restrictions on both deposits and withdrawals.
How does a minor open a bank account?
We’ve already established that kids under 18 need a parent or guardian to open an account — but how exactly does the process work?
While each bank and financial institution will have its own rules and procedures, there are a few general guidelines to keep in mind:
If you are opening an account in person at a bank, both the minor and the adult will need to be present at the time of account opening.
The bank will require personal information from both the adult and the minor, whether you are online or in person.
A minimum opening deposit will often be required.
To open the account, the financial institution will request certain information, including some or all of the following:
Photo ID, such as a driver’s license (for the adult)
Birth certificate and/or social security card and/or photo ID (for the minor)
Social security numbers (for both parties)
Date of birth (for both parties)
Proof of address, such as a utility bill (for the adult)
Keep in mind that rules vary by financial institution and by state. For full details, you’ll need to check with the bank where you plan to open an account.
What should I look for in a bank account for kids?
For children, the most important features include:
Mobile app: A functional and user-friendly mobile app is a big plus for kids these days. In fact, many teens prefer mobile banking over traditional online banking.
Low minimum balance requirements: Banks often have a minimum account balance requirement to maintain at all times. Others may require a monthly direct deposit (which most kids don’t have). It’s best to look for a bank with requirements compatible with your child’s budget.
Low account fees: All banks will have fees, like overdraft fees, when you spend more than you have available. However, some banks also charge monthly maintenance fees just to have an account open. This can be a burden for kids, even if the fee is small. It’s best to look for a bank with little to no mandatory monthly fees.
Interest: Finding an account that pays interest is a good way to show kids the power of putting their money to work. Interest rates are measured in annual percentage yield, or APY, which refers to the amount of interest a deposit will earn in one year.
Ultimately, the best bank for you and your child depends on several factors. Do you want a branch nearby, or are you okay with online banking only? Does the bank allow joint owners on children’s bank accounts? Be sure to check eligibility requirements, as each bank has different rules regarding accounts for minors.
A bank account is a valuable tool for teaching financial literacy!
Financial literacy refers to money skills: budgeting, saving, investing, and more. Financial responsibility is essential for life as an adult, and like so many other skills, it’s helpful to learn the basics of money management as a child.
Parents often wonder when they should open a bank account for their children or when they should start discussing money with them.
Well, the research shows that it’s really never too early to start! Kids can grasp basic money concepts as early as age 3, and surprisingly, many money habits are established by age 7.
If you’re a parent or guardian, it is a wise move to open an account for your child ASAP. Even if your child is young and only has money from allowance or gifts, opening a bank account can encourage saving for financial goals and teach many other valuable skills. In other words, bank accounts are helpful for educational purposes, even if the child doesn’t have a true need for personal banking yet.
As your child gets older, they can use an investing app that introduces the concepts of long-term savings, investing, and making your money work for you — all vital skills to enable wealth building.
Use Greenlight® for a complete money solution for kids.
Now that you know how old you have to be to open a bank account — that doesn’t mean you need to wait to put your kid on the path to a strong financial foundation!
For kids and teens, Greenlight is an innovative and ideal solution. The Greenlight debit card and app let kids learn valuable money skills first-hand.
Kids can earn money through chores, set savings goals, and learn to manage and spend their own money. Parents can monitor spending, send money instantly, set custom store and ATM controls — all from the Greenlight app. Plus, kids and teens can learn to invest through Greenlight’s investing accounts for parents. Kids and teens can propose trades, research stocks & ETFs, and monitor investments!
Greenlight requires a parent or guardian to sign up, but there is no minimum age requirement for kids. Ready to give Greenlight a try? Get one month on us!
*Greenlight is a financial technology company, not a bank. The Greenlight app facilitates banking services through Community Federal Savings Bank (CFSB), Member FDIC.
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