What’s an ATM card? A simple guide for kids and families
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“Wait, is an ATM card like a debit card... or not?” Great question! Especially when so many of these cards look the same. But an ATM card is actually in its own category. Think of it as a simple tool with one main job: It lets you withdraw cash from your bank account using an ATM.
You can’t shop in a store with an ATM card. And you can’t use it online. But it can be a helpful introduction to managing money, especially for kids and teens who are just starting to learn how banking works. Let’s go through what an ATM card is, what it’s used for, and whether an ATM card or a debit card is a better fit for your family.
What is an ATM?
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ATM stands for Automated Teller Machine. It lets you do some of the things a bank teller would help with, but without going inside the bank.
You insert your card and enter your PIN (personal identification number). Then, you can take out cash, check your balance, or, at some machines, even deposit money.
What does an ATM card do?
An ATM card gives you access to an ATM. It’s connected to your checking or savings account and lets you get to your money without going into the bank or using a digital app.
Let’s say your grandma gives you birthday money in a check, and you deposit it into your bank account. A few days later, you want to use some of that cash to buy snacks at the school fundraiser. With an ATM card, you could head to your local bank’s ATM, insert the card, type in your PIN, and take out the cash you need.
How is an ATM card different from a debit card?
It’s easy to mix the two up. Both an ATM card and a debit card connect to your bank account. Both also use a PIN and can be used at an ATM. But there are some differences.
An ATM card only works at ATMs, and the purpose is to give you access to your cash. A debit card does everything an ATM card does, plus you can use it to buy online and in stores. It functions similarly to a credit card, but without borrowing money. That’s where debit cards and credit cards are different.
So, if you just need cash, you can use an ATM card. If you want to use a card to buy a smoothie or order something online, you would use a debit card (but you can also withdraw cash from an ATM with a debit card!).
Why do ATM cards still exist?
Even with all the tech out there, ATM cards haven’t disappeared. This is because they’re simple to use, especially for kids who are just starting to learn about money. They’re limited on purpose, which can make them a helpful first step before moving on to a debit card.
How to choose what works best for your family
There’s no one-size-fits-all approach when it comes to teaching kids about money. For some families, it makes sense to start with ATM cards to help kids have access to cash. Other families might prefer to go right to a debit card, especially if their child is ready to take on more responsibility. Carrying cash can be risky (it’s easy to lose and hard to track), but there are safer and more secure ways to give kids more responsibility.
Tip: Greenlight’s debit card, for example, gives kids the ability to spend and save, with parents staying involved the whole way. With parent approval, kids can use their debit card at ATMs, make purchases online or in stores, and even set up savings goals. Parents get spending alerts, can set flexible limits, and manage chores and allowance in one app.
Want more money know-how? Meet the Greenlight debit card and app for the next generation. Kickstart a lifetime of financial literacy today💰Try Greenlight, one month, risk-free.†
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