How to Save Money on Student Banking

How to Save Money on Student Banking
  • Opening Intro -

    Young people headed off to college will want to have access to money that is being safely held for them by a financial institution.

    Cash on hand should be minimized, to avoid the risk of loss, theft or overspending.

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Costly bank fees can be avoided.

Where to place these funds is a cause of concern for some students, especially as new fees and limited access can make choosing a financial institution that satisfies their needs a challenge. Some commercial banks have increased its fees, making it difficult for students to find a bank that won’t erode their already limited funds. Fortunately, college students do have some options to limit or eliminate costly expenses.

Use a credit union

One option to commercial banks are credit unions — your family may already belong to one. Credit unions are owned by its members and are not-for-profit institutions, which means that the money these financial institutions do make is returned to stakeholders as dividends. Even if you go to school out of state, you can have access to your funds through teller machine networks with no fees charged. Notably, free checking is common with credit unions.

Ask about student checking

You may be able to escape monthly checking account fees as long as you’re attending college, but you need to explain to the bank that you are a college student. Your bank may waive fees for college students, so be prepared to show your college student identification card to take advantage of free checking.

Seek out an online bank

One of the reasons why banks charge fees and large ones at that is to cover overhead costs. Brick and mortar institutions must pay employee salaries, rent, utilities and other expenses associated with maintaining a fixed based operation. Online banks have a much smaller overhead, with usually a central office and a small operations staff. ING Direct, for example, is one institution with only a handful of bank building locations, but has significant online operations. No fee checking is available too.

Open an account with a parent

Your parents’ bank may charge a fee for their checking account, but offer subsequent checking accounts for no extra charge. The catch here may be that your account will have to be opened with a parent, who will be a cosigner on your account. Another advantage here is that checking accounts can be linked, enabling your mother or father to deposit money into your checking account instantly with an online transfer. This can be immensely helpful in a crisis when you need funds to fix your car, handle a medical bill or fly home.

Even if your bank doesn’t typically offer free checking, you may be able to secure no-fee checking by keeping a minimum balance on hand always. For example, if your account balance stays above $100, your fee for that month would be avoided.

See Also27 Ways to Save Money at College

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Categories: Personal Advice