Can a Parent Open a Bank Account for Their Teen Without Their Teen Present?

The answer to this question is yes, a parent can indeed open a bank account for their teenager without having the teenager physically present. However, there are certain considerations and steps to take to ensure the account is set up securely and legally.

Participating Banks and Setup Procedures

Most major banks and financial institutions in the U.S. will assist a parent in setting up an account for their teenager. These banks provide easy-to-follow procedures where a parent can access their child's account and set up fail-safes to ensure that only the parent and the teenager have access to the account. For example, you can configure the account so that only you and your 14-year-old can use it. These steps are designed to prevent unauthorized access and protect the minor from fraud.

Joint Account Setup

To further secure the account, a parent can make it joint with their teen and they themselves as the only account holders. In some cases, you might want to require both the parent and the minor to sign all withdrawals. This measure can be especially relevant until the teenager is older and more responsible.

Legal and Practical Considerations

Legally, no, a parent is not required to have the teen present when opening an account. However, in practical terms, having the teenager present can sometimes make the process smoother and more thorough. The bank may need personal identification or signatures from the minor to finalize the account setup, which might not be possible if the child is not present.

From a legal perspective, opening a bank account in a minor's name is generally allowed, but it must be done in compliance with the bank's policies and the laws of the state. In many cases, it's useful to consult with a financial advisor to ensure that all necessary documentation and approvals are in place.

Other Financial Instruments

It's worth noting that a parent might also consider other financial instruments like credit cards. While it's legally questionable and potentially risky to open a credit card in a minor's name, some parents still do so. If a parent does opt to use a credit card for a minor, they should be aware that it should not be used as a regular credit card but rather a convenience account that limits the amount and helps build a good credit history.

For instance, I grew up in a low-income neighborhood where it was common for parents to open credit cards in their children's names. In a few cases, parents maintained these cards properly, teaching their children about financial responsibility. However, in most cases, these actions resulted in the child starting their adult life with a poor credit score.

Potential Risks for the Child

While opening a bank account or credit card in a minor's name might seem advantageous, there are potential risks for the child. Credit card abuse and improper usage can result in a tarnished credit history, making it difficult for the child to obtain loans, credit cards, and even renting a place to live in the future. Even if the child's credit can be fixed, it often requires legal action and can complicate the parent-child relationship.

Conclusion

Opening a bank account for a minor is possible without the teen present, but it's crucial to follow the bank's procedures, set fail-safes, and consider making it a joint account. Parents should also be cautious about other financial instruments like credit cards, as they can have serious implications for the child's future.