For many young people, the newly found freedom of getting into college also brings days of financial independence. While some students may already have bank accounts, most will have to set them up and manage their finances for the first time in their life. When reading between the fine print, students can avoid making fatal financial mistakes.
Bank promotions for college students specifically market to these young adults, as it is the start of their financial journey. Colleges are in agreements that allow for banks to promote themselves with the endorsement of the institution. Students receive information about banking options they have on campus in the mail before they even arrive on campus. These campuses serve as a great opportunity for banks to market themselves to students. Almost 40% of total students sign up for these college-sponsored accounts, according to research.
Check the Fees
The fees that are charged for these bank promotions vary significantly from one another. Instead of just automatically choosing the college-sponsored bank account, you must investigate the fees associated with them. Just because the account is offered to you with your college/school logo, it does not mean that you should choose it immediately and it is not the only choice for you.
However, it can be significantly hard to gather the data associated with banking fees for college-sponsored banks. You can compare some of the institutions that have displayed the data on their website but, still, there are not any regulations regarding it and some pieces of information may be missing or not mentioned altogether. Usually, you will only know about the banking details of your specific bank through bank promotions. Also, there are some institutions who’s sponsored accounts do not charge any fees, so it really depends on where you end up.
Focus on Free
Usually, a student will not have enough money to spend freely. Therefore, you need to be conscious of the charges and limit your spending. Look for bank accounts that have minimum balance requirements, no maintenance fees, free ATM services, free debit cards and low transferring fees. Everything that comes with no charge best suits the needs of students and that should be your focus. Checking accounts usually have minimum fees as they are best used for keeping your money safe for short time spans.
Weigh ATM Convenience instead of Bank Promotions
The life of a college student is hectic and full of activities. You may be taking classes in the morning and working in the evening to pay for your room and board. A college student has little time to stray away from that schedule. Therefore, instead of focusing on promotions offered by the banks at your college, choose a checking account with no ATM fees because you will frequently need to withdraw money. Also, the choice of the account should also be based on your location. Most of the national banks have various branches all across the country, but ensure that there is one in close proximity to your location.
Some of the credit unions and online accounts also charge lesser fees, however, you must always read the fine print as there could be withdrawal caps.
Overdraft Fees on Debit Cards
Instead of being lured in by bank promotions, check for any overdraft fees on using your debit card. Accounts that are created through federal student aid usually do not have any overdraft fees, however, other accounts may charge you around $32 for not having enough credit for a purchase. Check for other fees that are associated with your debit card when you make a purchase above a certain amount. There may be hidden charges that you may not be aware of, so better be safe than sorry.
Student accounts usually mature after a certain age and turn in to a standard account after an age limit. Knowing the timeline and restrictions on the account beforehand can save you from a potential unwanted situation. Standard accounts also come in different varieties and bank promotions usually only focus on the ones with high fees. Do your own research and compare the multiple options you have before making any decisions.
Overdraft protection is one thing that you must stay away from. You may be inclined to use this protection but it typically comes with a high fee. You are better off receiving a declined transaction than getting charged for overdraft protection.
Focus on App Options instead of Bank promotions
With the ease of technology, it has become easier to keep tabs on everything and your bank account is no different. Almost, all reputable banks offer phone apps which can be used to keep track of your financial status and set certain limitations on the account for your own benefit. Many features offered in bank promotions are usually of no concern to students and the app is a handy tool to restrict your dealings with the bank.
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