Developing good money habits from an early age helps youth learn how to make smart financial decisions in the future. A debit card can help you teach your teen valuable financial skills such as checkbook balancing, spending within their means and making wise financial decisions.
Read on to learn more about our debit card option for youth, why some parents choose to get their teen a debit card, and what you’ll need to consider as you and your teen mark this financial milestone.
Why Get a Debit Card for Your Teen?
Getting your teen a debit card in their name when you’re a joint owner on their account can give them valuable experience with money management while giving you peace of mind about the safety of your teen’s finances. Getting a debit card for a teen 13 and older will allow them to:
- Learn Healthy Financial Habits: Your teen will use the financial skills you teach them throughout their lifetime. The more they learn about debit cards, ATMs, balancing a checkbook, and wise spending habits, the more practice they have in building their skills and making smart decisions throughout adulthood.
- Easily Deposit Allowances, Gifts, and More: If your teen is given cash or a check for an allowance, birthday, or other occasion, they can deposit it directly into their own account.
- Understand the Importance of Account Security: Having a debit card is a big responsibility, but it offers a great way to teach your teen about the importance of keeping their money safe. Show them the features of their account and debit card, such as locking their card if they’ve temporarily misplaced it, creating a secure PIN that’s not easy to guess, and keeping their card in a safe place.
PSECU Account Options for Youth
Our goal is to help you set up your teen’s financial future and teach them smart money management skills they can use over their lifetime. We offer two account types that you can choose from — including an account that grants your teen their own debit card access, if desired.
Once your teen turns 13, you have the opportunity to give them financial independence with a regular account. You can choose to be a joint owner on the account for greater control and supervision of your teen’s finances, or you can encourage them to open their own account.
Both the youth and any joint owners are eligible for PSECU debit cards in their own names with a checking account. For security, both cards will share the same PIN.
A custodial account is a type of account that an adult 18 or older opens on a teen’s behalf. The adult does not need to be a PSECU member to open the account, but the teen does need to be eligible for membership. While the money in the account belongs to the teen, the custodian handles the account’s withdrawals, deposits, and account access. While your teen cannot have access to their own debit card with a custodial account, this is a good way to start them out on the right foot. Until your teen turns 18, they can enjoy a special 1.00% Annual Percentage Yield (APY*) on up to $500 in their Regular share, while any balance over $500 will earn returns based on our Regular share savings rate.
Things to Consider When Getting Your 13-Year-Old a Debit Card
If you think it might be time to get your teen a debit card, here are a few things to keep in mind.
- Responsibility: Is your teen prepared for the responsibility of handling their own funds? If they’re not already familiar with money management, sit down with them to talk about this new responsibility before setting up their account. Make sure they understand that they can’t spend more than they have and that they’re aware of overdrawing their account. PSECU offers Overdraft Protection Transfer Service and Courtesy Pay Service. You should explain how both work, and make them aware that not all financial institutions operate that way.
- Overdraft Protection Transfer Service: This service uses funds available from a savings share, money market, other share account, or Visa line of credit (applicable Visa charges apply) that the member has elected to pay items presented against their checking account when a check or ACH transaction is more than your checking account available balance. PSECU does not charge a fee for transfers between your PSECU checking and savings accounts. However, if you choose to use a credit card to protect your checking account from being overdrawn, those overdraft transfers are considered cash advances. Refer to your credit card agreement for fees and charges related to cash advances.
- Courtesy Pay: This is a discretionary service available to eligible accountholders to cover checks and ACH transactions up to the Courtesy Pay limit if no funds are available in the checking account and after Overdraft Protection Transfer Service options on the account have been exhausted. There is a $30.00 fee for each item paid using the Courtesy Pay service. Eligible accountholders are automatically enrolled in this service. If you would like to opt out or have questions about this service, please call 800.237.7328. You can opt out of Courtesy Pay at any time. If you opt out and overdraw your account, you’ll be charged an NSF fee in the amount of $30.00 for each item, your check may not be paid, and you may incur additional fees such as returned item fees or late charges.
- Fees: Be sure to do your research on any fees associated with a checking account before you create an account for your teen.
Teach Your Teen Financial Responsibility with PSECU
It’s never too early to teach your teen how to manage their money responsibility.