These accounts usually come with limited fees but still have many of the same features as regular savings accounts. College students may be able to set up a direct deposit for their student loans if there’s money left over after their tuition and fees are paid for.
Example of a Student Savings Account
Opening a student savings account works a lot like establishing any other bank account: You either visit the bank in person or apply for an account online. Make sure you have the necessary paperwork before you get started—for instance, you’ll need at least two forms of ID. You could use your driver’s license and Social Security card to verify your identity. Most accounts will require you to deposit a minimum amount of money to open the account. This minimum deposit could be anywhere from $25 to $100. This is one difference between a savings account specifically designed for college students and a regular account: Some banks require much larger minimum deposits to open a standard savings account. From there, you’ll have to fill out the necessary paperwork to open the account. At the very least, the bank will ask for your name, date of birth, address, phone number, and social security or ID number. Once you fund the account with the minimum deposit, your savings account will be active. Make sure to find out if the bank charges any fees you need to know about. And you should find out if there are any fee-free ATMs near your work or school.
Benefits of a Student Savings Account
Pros
Helps teens and college students learn how to manage their money May allow access to additional financial resources Gives them the experience they need to become financially independent
Pros Explained
Learn to manage money: Opening a savings account helps students learn how to save and manage their money. Access to additional resources: Many banks will offer additional services for teens and college students, like help with budgeting or setting financial goals. Gain financial independence: When teens and college students understand how to set financial goals, budget, and save for the things they want, they gain the skills necessary to be financially independent adults.
Student Savings Account vs. Student Checking Account
Many banks offer both student savings and checking accounts with special perks for members under a certain age. Financial institutions recognize the opportunity of establishing a relationship with a young person just beginning their financial life, which is why many offer promotions and perks catered to students. Want to read more content like this? Sign up for The Balance’s newsletter for daily insights, analysis, and financial tips, all delivered straight to your inbox every morning!
