There’s no longer any reason why you need to hand out pocket money in cash, your kids can be just as card-savvy as you are. The key lies in giving your kids the right card to use. Handing your child a supplementary card on your credit card account is not ideal, instead consider a kids debit card. Here are your options.
Prepaid debit cards for kids
It is not a good idea to give your child a card that is directly linked to your checking or credit card accounts because it is much more difficult to monitor their spending that way. Very young people are also more likely to lose a card, or to be the victim of fraud – large credit limits mean you are exposed to a lot of risk.
Thankfully it is easy to give your kids a debit card that is independent of your own personal banking accounts. Of course, children can’t have bank accounts of their own: the law says account holders must be 18 or over, unless they open a joint bank account with an adult.
But there are plenty of alternatives. First, you can get a simple prepaid debit card account that supplies a physical card which you can top up. Another option is to get a family-friendly debit card account which lets your request several cards, one for each kid. Finally, you could also choose to open a joint checking account.
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Cash card for kids
Note that cash cards and debit cards are nowadays one and the same thing: banks issue debit cards for most accounts, it is rare for a bank to supply a card that cannot be used for payments as well as cash withdrawals.
All three options we mentioned in the previous section will come with a fully functional debit card. Kids can use this card to withdraw cash if necessary, but plenty of children will prefer to make electronic payments at points of sale in major stores, just like their parents do.
Parents should consider the age and financial maturity of their child before choosing a debit card product. Younger children should have access to a more basic financial product only, while older children can take the first steps into financial adulthood by enjoying the use of a full-service checking account, jointly opened with their parents or guardian.
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Debit card for 12 year old
Let’s take a look at the best options for younger children first. If your kid is in their early teens you should choose a debit card product that offers both you and your child a greater level of control and protection. Essentially, you need to choose between a simple, straight-forward debit card with little in the way of features or a more fully-featured family debit card product.
Simple debit card products include the Chase Liquid card and the NetSpend Prepaid card. With both of these parents simply pay the monthly fee, get the card, and load it with funds. There’s no need for any additional messing about. However, you’d pay a monthly fee for every child you want to give a card to, and you have relatively limited control over how prepaid funds are used by your child.
Another option is a family-friendly prepaid card from a provider like Greenlight or FamZoo. Here, parents can pay a single monthly fee to cover the entire family with debit cards while also getting the opportunity to finely tune spending, closely watching the use of each individual card. Debit cards like these also come with handy apps so parents can control their kids spending from the convenience of their phones.
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Best debit card for teens
Older teens can be handed far more financial responsibility than kids just a few years younger. Children mature quickly and parents may want to help older kids learn the financial ropes before they turn into young adults. One way to do this is to open a joint checking account with your teenage child.
Banks offer teen-focused checking accounts that come with most of the same features as adult checking accounts. The benefit of using an account like the Wells Fargo Teen Checking Account or the Capital One Money Account is that there are no ongoing monthly fees, whereas prepaid debit cards charge monthly service charges that add up.
However, parents should note that acting as a joint holder of a checking account makes you liable for all other charges on the account. For example, if your teen accumulates overdraft charges on a checking account, you will be liable to pay these charges. Nonetheless for responsible teens, checking accounts are a good first step into the world of finance.
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