Ask the expert: What's the advantage of student checking accounts?
August 29, 2011
Q: Is there a particular advantage to choosing a student checking account? I know there are student checking accounts that will give me free checking, but if I can also find regular accounts, open to anybody, that also offer free checking, is there any particular reason I shouldn't choose one of those instead?
A: If the ultimate goal is to get free checking, there is no reason a student should feel confined to an account labeled as being for students. However, there are a few reasons why you might want to focus your search on student checking accounts:
- With more and more banks moving away from offering free checking, looking for student accounts might be a good way to identify likely prospects. Just don't assume that everything labeled as a student account is actually free.
- An important feature of many student accounts is a low balance requirement. As a practical matter, a low minimum to open and a low ongoing minimum might be a necessity for many students.
- Some student accounts also offer features that are friendly to newcomers to the banking world, such as a free first order of checks, or reduced overdraft fees. Regarding the latter, you'd still be better off opting out of overdraft protection, but if you do choose overdraft protection, having reduced fees could help.
On the flip side, the only argument against choosing a student account is that you will only be eligible to keep it for a few years. Then you would have to switch into a regular account at the same bank or find a new bank, and there is no telling whether the terms of your new account would be as attractive. Still, as often as banks are changing their account terms these days, the prospect of having to switch in a few years should not be a particular deterrent from choosing a student checking account.
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