How to get the best bank account for your teenager 

As teenagers transition into young adulthood, it becomes essential for them to have a bank account that caters to their financial needs. A well-structured bank account not only allows teenagers to manage their money effectively but also helps them build responsible financial habits for the future.  

There are several banks in South Africa, such as Absa, Nedbank, Standard Bank, and FNB, that offer specialised accounts tailored for teenagers, providing them with valuable tools and benefits. There are also other banks to consider like Bidvest Bank and Investec.  

But how do you help your teen choose the best bank account? 

Research and compare

The first step to finding the right bank account deal is to conduct thorough research and compare the offerings of different banks. View bank offerings for teens on their respective websites as most have guides and price lists online.

Read the fine print and avoid charges

A few years back many banks charged kids for transacting, particularly for over-the-counter transactions in branches. Many have scaled back their fees and in most cases offer free transactions for children and teens. But make sure you know what the limits are, if any. Where possible encourage your child to swipe their card and do online transfers rather than deal in cash as there are often limits to cash transactions before charges kick in.
With Standard Bank, for instance, cash deposits of up to R1,500 at ATMs are free and you get 10 free electronic debit transactions a month and can do free cash withdrawals of up to R1,000. Keep an eye on fees as banks can (and do) change them as well as the free transaction limits.

Make sure your child qualifies for the account on offer as well. Some banks have different accounts for respective teenage groups. With Nedbank, for instance, its Nedbank4Me account is only applicable to children younger than 15 years old. Meanwhile, Standard Bank’s Sum(1) account is available for teens under the age of 16 while teens over the age of 16 qualify for its MyMo accounts. Tshiamo Molanda, Head: Youth Segment at Standard Bank, adds: ‘[What’s] important is that once clients come of age they need to move to the relevant account to avoid penalty fees of R9.99.’

Consider the perks (but not too much) 

Perks are a great way for banks to entice customers to switch accounts or sign up as new customers. Of course, they can be a great money saver too so should be considered. Banks typically offer discounts through partnerships they have created or offer rewards points that are linked to the parent account and teens could earn rewards too. 

These can be harder to compare as they’re not all ‘like for like’. Absa’s MegaU account for those under 20s, for instance, offers 100MB of free data every month as well as discounts at selected food outlets and free Kidz activity lessons (Aquatots, MiniChess, Young Engineers, and more).  

Standard Bank, meanwhile, offers perks such as PluggedIn, which is a career tool that helps kids select the best careers and helps them make the best subject choices at a school. For R5.95 per month, Standard Bank’s MyMo account offers a discount for Varsity Vibe, a youth-focused discount platform, access to digital courses, PluggedIn Career assessments, job recommendations, job opportunities, and online courses and R100 airtime for just R5 on Standard Bank Mobile SIM cards. 

Make sure your child qualifies for these perks. Absa says you can qualify for monthly value-adds by maintaining a minimum of R300 per calendar month or performing at least four banking transactions per month – two of which must be prepaid transactions.  Review competitors’ perks regularly and make sure your child maximises these perks as best they can regularly, particularly if they’re paying a fee to access them.  

Compare interest rates 

Your teen’s current bank account may offer interest but you’re more likely to get better interest from associated savings accounts. With Standard Bank, for instance, you can link your teen’s bank account to the PureSave account, which currently offers an interest rate of up to 6.10%.* 

Remind them that it’s ‘not a bank for life’ 

Research suggests that clients generally remain with the bank where they opened their first bank account, but loyalty to your bank is not always in you or your child’s best interest (pun intended). While some banks may offer amazing perks and perhaps even a good sign-up deal it’s important to convey to your children that the bank they choose now doesn’t have to be the bank for life.  

Keep an eye on the rival bank accounts and what they offer. If you’re uncertain about switching you don’t have to close your account to open another.

‘It’s wise to compare what’s on offer. You can move and choose to bank with multiple banks at a time,’ says Molanda.  

*Correct as of 21 June 2023