October 27, 2022
How to take your parents’ names off your bank account
Being a financially independent adult starts with getting your own bank account. Learn how to take your parents’ names off your bank account and open your own.
If you’re like many, your parents opened a bank account for you at a young age to teach you money lessons.
At the time, all you had was your birthday money, holiday gifts, and maybe an allowance to throw into your bank account. But it was a vital first step in building your financial future.
But as you approach adulthood, you can open and maintain a savings account yourself—and ditch the one you shared with your parents. It’s the next step in becoming a financially independent adult.
This article will show you why you should get your own bank account and walk you through the process of doing so.
What is a joint bank account?
A joint bank account is just a bank account you share with someone else.
Minor children can’t legally open their own bank accounts, but your parents can open one for you and put both your names on the account.
But setting aside that allowance or first-job paycheck gives you a head start on saving for your college education, too.
Obviously, your pre-college earnings won’t cover all your education costs. But kicking off your good money management early makes the transition to adulthood smoother and, at the very least, offers you some peace of mind when you’re a “broke college student.”
Why you should take your parents' names off your bank account
Look: At some point, you’ll need your own bank account as an adult. You can’t become financially independent without it.
Doing it as early as possible—like in college—puts you on the road to independent adulthood early and makes you feel like an adult.
It brings along a few benefits, like:
You gain complete control of your money
Your parents have as much access to your joint account funds as you do. Regardless of how they use that power, you can never be fully independent if they still have it.
Cutting the cord and getting your own account gives you more control over your personal finances. You are entirely responsible for keeping money in the account, not overdrawing it, paying any fees, and so on.
It can be scary at first, but also rewarding. No more limits of any kind. No need to depend on your parents to do things for you. No need to worry about parents dipping into your hard-earned money.
That said, your parents aren’t out of the picture when you have your old account. They can still transfer money to you.
These days, some banks have integrated technology that makes bank transfers free and instant. So it’s almost like your parents are still on your account but without access to your cash.
You get more financial privacy
When you have a joint bank account with your parents, they have the same level of visibility. They can see your every financial transaction.
Some may find this to be no big deal. Others much prefer their parents don’t see their spending habits and call them with concerns every week.
Once you ditch the joint account and get your own, this is no longer a concern. Only you can access your personal bank account.
Your assets are protected against parental financial issues
If a parent is on your bank account with you, it’s technically one of their assets. That means if they end up in a situation where their assets are seized, the person doing the seizing might come after your bank account.
This could happen if they use the bank account as loan collateral, receive a judgment against them in court, or fall into tax debt.
All of these situations are terrible, but you’re an adult. You can help your parents voluntarily if you want, but you don’t want outside entities seizing your money because of your parents’ decisions.
How to get your own bank account
If you’ve never opened a bank account on your own before, it may sound a bit confusing. What documents do you bring? Do you have to pay the bank anything? Does it take a long time?
Actually, it’s fairly straightforward. The hardest part, as you’ll see, is researching accounts. But we’ll help you with that and the rest of the process below.
1. Decide the account type you want
First, pick the account type you want. Most students will do well with either checking or savings accounts, but the best account varies based on your needs. You may find you need both.
Checking accounts are the more flexible account type. You can withdraw as many times as you want, as long as you have the money available. You’ll also get a debit card that lets you spend out of the account and withdraw money at ATMs.
That said, most checking accounts don’t earn interest on their balances.
Therefore, checking accounts are suitable for students who need a spending account.
Savings, as the name implies, are designed for you to set aside money. Most only let you withdraw 6 times per month without incurring fees.
However, they pay interest on the balance to help reduce the effects of inflation.
Some savings and checking accounts are designed for students. They generally have low or no maintenance fees or opening deposit requirements.
These accounts will also provide financial literacy and education resources to help you understand banking and your money.
You must be an active student to get one of these. Once you graduate, your bank may convert this to a regular account. Be ready for that—you might start paying fees associated with a regular account.
2. Shop around for banks
Next, look around for the best banks and bank accounts.
Each bank and account will differ when it comes to account features. Here are some factors to consider:
FDIC insurance: Make sure you pick a bank that is FDIC-insured. This covers losses if your bank goes under. Most banks you’ll find will be insured, but checking never hurts.
Monthly maintenance fees: Fees charged for keeping the account open. They may be waived for a minimum balance.
Minimum opening deposit: The amount needed to open the account.
Interest: Compare savings interest rates. Some checking accounts may also pay interest.
Online and mobile banking: Online and mobile banking make your banking convenient. Look into a bank’s online banking features and security.
Branches: Check out branch availability near you in case you ever need to visit a branch.
Rewards: Some banks offer rewards when you spend with the account’s debit card.
Customer service: See what options they offer, such as phone and live chat. Read reviews to get a feel for how customer-friendly they are.
Other fees: Compare fees for ATM withdrawals, overdrafts, insufficient funds, and so on. Some banks may reimburse ATM fees or have no overdraft fees.
3. Apply for the best account you find
Did you find an account you like? It’s time to apply.
Many banks let you do this all online without leaving home. It should only take a few minutes.
The application will ask you for some basic information such as your name and Social Security number. It’ll also ask you to agree to disclosures and other relevant policies.
4. Fund the new account
Finally, it’s time to fund the account. You can write a check or initiate a transfer from your existing account to do this.
Note that you don’t need to fund the account immediately if it doesn’t require an opening deposit. Fund it as soon as possible, though, so you avoid maintenance fees and can start using your new account.
Closing the old joint account
Now that you have your own account, it’s time to close down the old joint one.
Here’s how to do that as smoothly as possible:
Switch employer and financial aid direct deposits
Start by updating your bank information with your employer and financial aid for direct deposit purposes.
This will ensure your paycheck, loans, and other aid goes to your new account immediately. No need to worry about continuing to make transfers between accounts, and it gives you more control of your finances during the account closure process.
Update regular payments with your new account details
Pay any bills with the old account? Update that information, especially any automatic payments, like streaming services.
This will help you avoid overdrawing that old account accidentally or payments failing once you close the account.
Inform your old bank
Let your old bank know you want to close the account. The bank may also need consent from your parent, so it’s easiest to do this in person.
However, you may be able to call, email, or chat online to handle this.
Ditch the old account’s debit cards and checks
Finally, cut up any debit cards and shred checks associated with the old account. Don’t just throw them away—you don’t want any old account or debit card numbers available, as this could lead to identity theft or other issues.
If you have no way of destroying these, your bank may do it for you.
It’s time to get your own bank account
You gain control of your money. That means more privacy in financial transactions and more independence from your parents’ financial decisions.
Not everyone is ready to sever ties at 18, though. A joint account during college may be beneficial. Have this conversation with your parents and decide on a good time to get your own account.
With Mos, you can open a joint account with a sponsor as a teen, then easily switch to a solo account once your 18th birthday rolls around. Once you’re ready, check out our complete guide to banking for college students so you can make the best use of your account.