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Ask the expert: How much financial latitude to give a high school student
Q: My daughter is in high school and needs a checking account for her job, which raises a lot of questions. How much latitude do I give her about keeping her own records, using a debit card, etc.? I want her to learn, but I don't want her to get into financial trouble with too much freedom.
A: If your daughter is old enough to have a job and a checking account, then she is old enough for you to expect her to take on the adult responsibility of managing her checking account. However, that doesn't preclude hands-on supervision by her parents.
Here are some suggestions for getting your daughter's checking account habits off on the right foot:
- Look for an account with no monthly fees. Initially, her account balances are likely to be quite small, so it is important that you don't let them get eaten up by monthly maintenance fees. Several banks still offer free checking accounts, and some cater specifically to students with free student checking accounts.
- Let her have a debit card--but opt out of overdraft protection. A debit card will leave your daughter exposed to the temptations of impulse spending, but better she should learn to handle this now than in a few years when she gets her first credit card. If you opt out of overdraft protection, you'll be able to limit the trouble she can get herself into.
- Let her balance her account, but look it over afterwards. Teach your daughter to balance her account, but check to make sure she's doing it correctly. This will make sure she is doing it regularly and correctly, and it will also tell you if her spending habits are out of line.
The more you find your daughter is handling her finances responsibly, the more you can back away from close supervision and just check in occasionally to see how her checking account is doing.
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