Since many high school or college students may be managing a checking account for the first time, I thought it would be useful to share some tips.  As with much financial advice,many of these tips focus on problems/mistakes you want to avoid (resources for post here and here).   Interesting class lesson might include a conversation on how to avoid these costly mistakes:

• Set up e-mail alerts on your account to notify you when your checking account falls below a certain level so you can avoid the next item on list.
• Avoid bounced checks – you pay two sets of fees (median fees $30 from retailers and $27 from banks) and shows that you don’t have a handle on your finances.
• Minimize overdraft fees – good news is the bank provides you with funds to prevent you from overdrawing your account, bad news is that you get charged a fee for it.
• Avoid monthly fees – they show up every month and may not be much ($5-$10) but they add up over time.  Some banks will offer students no-fee checking so be sure to comparison shop.
• Avoid Out-of-network ATMs – you find yourself out of cash and not close to your bank’s ATM.  What do you do?  Use another bank’s ATM and pay a fee.  Some banks will provide a benefit by waiving this fee so read the account details closely.
• Keep your PIN private – you gave someone else your PIN number and they took money out of your account.
• Know if there is a deposit lag – you deposit a check into your account and don’t realize that it takes several days to “clear” and for your account to be credited.  Can lead to #1, bounced checks.  Find out the bank’s rules on funds availability.
• Protect your debit card.
• Your checks are lost or stolen – Yikes!  What would you do?

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.

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