Budgeting basics: How to withdraw money wisely

Getting your first bank account is an exciting milestone for kids. Learning what it means to withdraw money and how to do it is a whole new world. Whether your kids need guidance in figuring out how to use ATMs, talk with bank tellers, write a check, or transfer funds between accounts, learning all the different ways to withdraw money is a common foundational step in the world of kids and finance.

How to withdraw money from an ATM

The ATM is a must-know for many everyday situations your kids might run into, especially since it’s one of the most common ways to get cash. Things like festivals, fairs, and farmers markets are often cash-only. If your child needs cash, knowing how to use an ATM is a good life skill to have.

Here's a brief rundown on how to withdraw money from an ATM you can share with your kids:

1. Insert your card into the designated slot.

2. Enter your PIN securely.

3. Choose the amount you want to withdraw.

4. Is there a fee for withdrawal? Talk to your kids about what’s reasonable. Fees can range from 50 cents to several dollars.

5. Confirm the transaction and wait for your cash.

Voila! You've successfully mastered the art of withdrawing money from an ATM.

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Other methods of withdrawing money

While ATMs are a convenient option, there are other ways to withdraw money that kids and teens should know about.

Visiting a bank

For old-school banking, kids can visit their local bank to withdraw money. This provides an opportunity to interact with a bank teller and understand the process of withdrawal. In many banks, this process involves using a withdrawal slip and filling out details such as the amount to be withdrawn, account number, and signature. 

Increasingly, banks are going paperless with tablets or other input devices. Oftentimes you only need your debit card to make a deposit or withdrawal. 

Writing a check

For more advanced options, kids can learn how to write a check as a method of withdrawing money. This involves writing the date, the payee's name (the person/business you're paying), the amount in numbers and words, your signature, and the reason for the check. Cashing, depositing, and writing checks can also help teach kids the importance of record-keeping and tracking their expenses.

Transferring money

Transferring money between accounts, especially online, is a common way to make funds available to withdraw. If your child has a Greenlight debit card, you can transfer funds within the app to help your kids make parent-approved withdrawals securely. 

Cash back at the register

Some stores offer the option to receive cash back when making a purchase with a debit card. This can be a convenient way to withdraw money without having to visit an ATM or bank.

What else should kids and teens know about withdrawing money?

Budgets are important financial tools

Teaching kids how to withdraw money is the perfect opportunity to discuss budgeting. Review withdrawals and other transactions together to help them understand where their money is going, get a clearer picture of their spending habits, and learn to manage their funds effectively.

The limit does exist

Work with your child to set a cash-withdrawal boundary. Setting financial limits can help prevent overspending and teach kids how to keep their budget on track. 

Watch out for fees

Sometimes your bank or financial institution will withdraw money from your account in the form of ATM fees, overdraft charges, or penalties for not maintaining a minimum balance. These fees can add up and eat into your account balance. Make sure your kids are aware of these potential pitfalls and how to avoid them.

Read your account statements

Encourage your kids to read and understand their bank statements and ATM receipts. This habit is a great visual way to see the budgeting process in action, spot any discrepancies, and foster good financial habits. Reviewing statements each month is an excellent way to help kids learn to keep track of their spending and account balance.

Keep your card and PIN safe

Security is paramount when it comes to banking. Teach your kids the importance of keeping their card and PIN safe and secure. This includes creating high-quality passwords, not sharing their PIN with others, and being mindful of their surroundings when using an ATM.

Always check your balance

Before making any withdrawal, it's crucial to check the account balance. This practice can help avoid overdraft fees and ensure they're aware of how much they have left in their account. 

Double-check for pending purchases

Purchases and money withdrawals can sometimes take a while to reflect in the account balance. Teach your kids to be mindful of this and double-check for any pending purchases before making a withdrawal to avoid accidentally overspending – and the related overdraft fees that can result. 

Update budget trackers

If your child uses any budget trackers, remind them to update them after making any withdrawal. Maintaining accurate records of their spending can help kids learn to manage their budget and accounts more effectively.

Each time your child asks to withdraw money, it’s an opportunity to equip them with the skills they need to navigate the financial world confidently and responsibly.