Debit cards are one of the most convenient ways to pay vendors and access money. They’ve been around for more than half a century: The Bank of Delaware launched a pilot debit card program in 1966. By 2017, some 44% of Americans used debit cards for daily purchases, 10% more than those who used credit cards.
But just how old do you have to be to get a debit card?
In most banks, the age requirement to open a bank account and receive a debit card is at least 13 years old, but minors will need a legal guardian to open a joint account until they reach the minimum age. Some banks may offer prepaid debit cards, which can be “reloaded” with cash and aren’t linked to a traditional bank account.
Companies like Greenlight and GoHenry allow parents to monitor and control debit cards specifically designed to help kids learn the value of money. Some of these don’t have any minimum age requirement.
Teens who are interested in getting a debit card should consult with a family member before making this decision (they’ll likely need an adult to be a joint account holder). It also may be helpful to talk to an expert and sit down with a bank or credit union representative to go over options, policies, and account specifics in detail.
To apply for a traditional debit card, as opposed to a prepaid card, a teen will first need to open a bank account. Minors (younger than 18) are not allowed to open bank accounts by themselves because they are forbidden by law to enter into legal contracts on their own. An adult is needed as a joint account holder. Some banks require the adult to be a parent or legal guardian, while others permit anyone older than 18 to sign on.
When signing up for a bank account, you’ll need to bring the following information:
Things to consider when selecting a debit card include fees, rewards, and the size of its ATM network.
Banks have different policies, so it’s good to be aware of what you might be facing. Some banks charge fees if you use an ATM outside of their network. Others reimburse ATM fees at the close of each statement cycle. Some debit cards even come with rewards programs that offer you a percentage cash back or points when you use them, but these are less common.
Be sure to check your financial institution on its policies and ask about the following.
Generally, children can’t open bank accounts independently because they can’t enter into a valid contract until they’re of age.
Age restrictions vary by bank. For instance, Citizens Bank allows teens to open a joint account at age 16. Wells Fargo offers a checking account with no overdraft fees, no check-writing ability, and lower account balances for kids ages 13-16 with an adult co-owner. Credit unions offer teen accounts too.
Debit cards usually have daily spending limits, meaning that making large purchases may not be possible. They may also have withdrawal limits. In some cases, your ATM withdrawal limit may count toward your overall spending limit. For example, if you had a spending limit of $750 and withdrew $100, then you couldn’t spend more than $650 in the same day. Check your bank to see whether you have spending and/or withdrawal limits, and what they are.
Some banking apps let kids have their own debit card, while also providing parental controls over the teen’s account for greater peace of mind. They allow parents to oversee their kids’ accounts, be notified when the debit card is used, and manage allowance. Weigh the features and user-friendliness of different apps to determine which is the best fit for you and your child.
Debit cards don’t typically come with annual fees, but you might need to pay a replacement fee if yours is lost or stolen, and some do carry a maintenance fee. Also, while the cards themselves don’t usually carry fees, they may be attached to checking accounts that do charge monthly maintenance fees and overdraft fees, among others.
Debit cards for kids, like FamZoo and GoHenry, also carry monthly fees. Pricing varies.
Also, if your teen’s card has overdraft protection and they use their debit card for a purchase that exceeds your balance, there will be overdraft fees, which can run $35 per transaction. Bank of America recently announced plans to cut its overdraft fees from $35 to $10. (This isn’t specifically a debit card fee, as you can overdraw your account in other ways as well.)
Debit cards can help teens gain financial literacy as they learn how to monitor their balance, budget for things they want to purchase, and learn how to manage their money in general. It can give them access to cash they’ve earned, so they can feel invested in the process.
Debit cards eliminate the need to carry cash or physical checks to make purchases. However, if they need cash, users can use their debit card as an ATM card to withdraw cash from their checking account.
Having access to a debit card early can help teens learn to manage their money and develop good money habits. They’ll be able to learn about budgeting along the way as well.
Online banking is a safer form of payment than cash. When buying online, it’s important that teens use a secured network and can recognize scams or untrustworthy sites. Remind your teen to check with you for major purchases and before using a site they’ve never purchased from before.
It’s also helpful to remember the distinctions between a credit card and a debit card. Importantly, it’s safer to use a credit card to buy online because of the protections against fraud and misuse it offers, as opposed to a debit card, which has direct access to your checking account.
What happens when your child turns 18 depends, to some extent, upon the bank. Some banks will close a teen’s checking account when an account holder turns 18 or automatically convert it to a regular checking account. If the account is closed, account holders can choose to open a new account in their own name or open a new joint account.
Understanding the value of money and saving helps teens to set the stage for handling finances as adults. Knowing how money works is important when saving for retirement because the sooner you start, the better. It can also allow for understanding things like compound interest, the importance of building credit, and saving up money for goals and emergencies.
Having a debit card gives teens something tangible to teach them a sense of responsibility and why it’s important to keep track of their money as they spend it.
Ana Gonzalez-Ribeiro, MBA, AFC® is an Accredited Financial Counselor® and a Bilingual Personal Finance Writer and Educator dedicated to helping populations that need financial literacy and counseling. Her informative articles have been published in various news outlets and websites including Huffington Post, Fidelity, Fox Business News, MSN and Yahoo Finance. She also founded the personal financial and motivational site www.AcetheJourney.com and translated into Spanish the book, Financial Advice for Blue Collar America by Kathryn B. Hauer, CFP. Ana teaches Spanish or English personal finance courses on behalf of the W!SE (Working In Support of Education) program has taught workshops for nonprofits in NYC.
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