Going off to college comes with many responsibilities — including the responsibility of monitoring finances more closely. Those that are moving onto college right after high school may not have any previous experience monitoring their own bank accounts.
However, now is the time to learn! If you’re going off to college and are trying to figure out what you need to do, make sure to add getting a bank account to your list.
Getting a bank account is your first step to independently organizing and managing your money. This is essential as you start taking on responsibilities such as having an on-campus job, paying for books, and taking out student loans.
If you’re just getting started with opening a bank account, keep the following tips in mind.
Where the bank is located
The first thing you’re going to want to consider is whether or not the bank has a branch that is located near your campus.
You may occasionally need to go to the bank in-person, so choosing a bank that has locations near your hometown and near your college is recommended.
It is possible your college already has an affiliation with a particular bank and may have ATMS from that bank on campus. And while it is good to consider that particular bank as an option, don’t make your decision based solely on that affiliation. You want to make sure that the bank can meet your needs.
Focus on features
When it comes time to narrow down your choices of a bank, look at what features they offer to students. Most banks will offer bank accounts specifically for students that come with some free features.
For example, some banks charge monthly maintenance fees or require a minimum deposit amount each month. These features are usually waived for student accounts, because students have limited amounts of money and because they might not be in a position to make monthly deposits.
Whenever you are considering a bank, ask them if they have student-specific bank accounts and what the benefits come with one of those accounts. Compare several different banks before making a decision.
Know about interest rates
Over time, bank accounts and saving accounts will accumulate interest. Interest rates vary, but higher interest rates result in a higher yield.
Ideally, you’ll have a savings account in addition to your main bank account. This is because you’ll generally earn more interest on savings accounts. Because of this, savings accounts have higher annual percentage yields (APY) than banking accounts do. You can use an APY calculator to get a sense of how much interest your savings account will accumulate.
Understanding interest rates can be confusing at first. If you’re struggling to understand interest, you should sit down with a bank representative to learn what options are available to you.
Check out the app
Mobile banking has become popular. Mobile apps grant you constant access to your bank and saving accounts, allowing you to see how much you have available, as well as withdrawals you have made. Gone are the days of having to balance checkbooks.
Each bank uses a slightly different mobile app. You may find some apps easier to use than others. To get a sense of what apps are available to you, start looking at online reviews from other users.
Some banks will have apps that are specific to students. These apps tend to be designed in a way that allows you to learn how to use a mobile banking app.
Accounts after college
If you choose a bank that uses student accounts, ask them how easy it is to transfer your account into a regular account after college. Most banks will expect you to get rid of your student account after graduation.
However, even if they make you get rid of it, most banks will help you open up a new non-student account. Most of the time, this transfer doesn’t cost you a thing and can be done within a matter of minutes.
Whenever you transfer, ask your bank about any differences with your new account. Generally, there will be an expectation for you to have a minimum balance and to make deposits several times a month.
If you’re heading off to college and don’t yet have a bank account, now is the time to start doing your research. Even if you already have an account, you should double-check that there is a branch of your bank located near your college. Making good financial decisions now can help you become financially secure in the future.