Playing at the Bank

Opening up your child's first bank account is a very critical step along their financial path.  It will be one of their first introductions to personal finance and money management and it will set the tone for their financial future.

When opening up your child's first bank account, here are some things to consider:

1. Choose a smaller, local bank where your child can actually sit down for a few minutes with the branch manager to get to know him/her and a little bit about banking.  Here in Smithtown, I recommend starting with a bank where you already bave established a relationship.  If you do not have a strong relationship with your current bank or if your current bank is not very kid friendly, the Bank of Smithtown or Teachers Federal Credit Union are great options.  

2. I always advise parents to offer "matching deposits" for their kids.  If  kids choose to save some of their allowance, their earnings from a part-time job or cash gifts from birthdays rather than spending them, parents should match the deposited funds in order to encourage further saving.

My parents did this with me starting when I was seven years old by offering to match any of my cash gifts from my birthday that I choose to save rather than spend.  They got me started at an early age and I cite this as the number one reason why I learned such discipline when it came to savings and managing my money. 

This discipline is what allowed me to purchase my first house when I was 23, fund the start up of my accounting firm when I was 24, purchase a vacation house when I was 26 and purchase a building when I was 27.  

If you have not brought your child in to open up their first bank account yet, do so now.  Get them involved early and often.