We've seen that look of surprise before. Your son or daughter has overdrafted the account, and the credit union wants you to cover the deficit and pay the fee because your are still a joint owner on the account.
Oops! Did you forget to take your name off the account when your son or daughter turned 18?
Opening an account for a child is a great way to help them learn how to handle money when they're young, but it also means you are liable for all unpaid items, fees, and transactions committed by your son or daughter when they get older -- no matter the age!
To avoid that risk, you AND your child need to complete new signature cards, removing you as a joint owner of the account.
Some parents choose to retain joint ownership of a minor's account so they can monitor account transactions when their child is in college or starting out on their own. As joint owner, you can review account statements, transfer money as needed, and protect your son or daughter from making a critical financial mistake.
Other parents choose to cut the financial ties with their children at age 18 or later to help them take responsibility for their own money. In this way, your son or daughter will reap the benefits - and the consequences - of their own financial choices.
Either way, STCU recommends that you and your children avoid surprises by discussing how your son or daughter's money will be managed when they turn 18. Talk about who will cover any fees or overdraft charges. Review the pros and cons of credit cards and the consumer practices that can help consumers to establish good credit. (Learn more at My Life, My Money.)
For questions about your children's accounts, call (509) 326-1954 in Washington or (208) 619-4000 in Idaho. Or visit your nearest STCU branch location to complete new signature cards.
