When Is the perfect time to get your kid a debit card? Four things to consider
With summertime in full swing and kids working part-time jobs or doing chores for family, friends and neighbors to earn a few dollars, the question always comes up: when should your child get a debit card/ bank account to start learning to manage their own money?
Dean Brauer, the president and co-founder of gohenry, and an expert on all things kids’ finance, shares his advice to parents who are considering when to get their children a debit card. Dean believes in empowering kids to learn, encouraging them to earn, save, and plan with confidence.
Dean has shared the following answers to popular questions amongst parents:
What are the pros of giving a child a debit card?
“Ensuring your kids have the tools to gain independence with managing a budget, learning to save, and making spending choices is a positive thing. It’s important to find a bank or financial app that offers all the tools they need to provide their children with this kind of independence but under the guidance of parents and with boundaries.”
What are some of the advantages of introducing kids to banking products early on?
“With the right tools parents can nurture their children’s money confidence from a young age by helping them learn about the differences between their wants and needs, provide encouragement to take responsibility for earning their own money and making their own spending choices. Ultimately, the tool a parent chooses should help teach their kids to be smart with money.
“Kids are purchasing a lot on sites like Depop, Etsy, or Roblox – better to have them use their own debit card with spending limits than use a parents’ credit card. This will help them learn to make spending choices with their own money. With your credit card, expensive mistakes are just a touch away and they don’t view it as their money but rather just another item bought by the Bank of Mom or Dad.”
What are some downsides or potential pitfalls to watch out for?
“It’s important that the right guardrails are in place around their spending and that parents are using these as tools to help teach their children about finances and good money management. With the right oversight and functionality it means that kids can limit their mistakes – we always say better a wasted $10 at 10 years old than $10,000 of debt when you go to college and get your first credit card.”
When does it make sense to get your child a bank account?
“This is largely a decision by the parent about what is right for their family. Research shows kids can develop their attitudes and habits towards money as young as seven years old, so between the ages of 7-13 is a great time to get started. In the US, the average age a teen opens a checking account is 17 years old, just before they go off to college. I recommend starting younger than this so that kids can learn the fundamentals of managing money and can gain confidence within earning, saving, and spending before they fly the nest.”
gohenry, the ultimate kids’ debit card and financial education app, has a mission to help every kid be good with money. Founded by parents, designed for kids and teens, gohenry offers a debit card and app with unique parental controls for kids 6-18. Parents use gohenry to help their children spend safely and learn good money habits, and it also helps to make allowance easy, and to spark positive conversations about money with their kids. gohenry’s Earning, Saving, Spending and Giving features offer kids and teens a practical way to learn good money habits.
The gohenry card is issued by Community Federal Saving Bank, Member FDIC, pursuant to license by Mastercard International.
For more information visit: www.gohenry.com
The gohenry app is available to download on the Apple Store and on Google Play.