Great transaction accounts for younger Aussies
We all know that teens, students and Aussies just starting out in their careers don’t have money to burn and so it’s important that they find a transaction account that offers them a bit of extra help.
That extra help can come in the form of free ATM transactions, or in waived monthly account fees, no minimum monthly deposit requirement or even as a (admittedly rather low) interest earning rate applied to the balance.
Youth and student bank accounts tend to be the most helpful, with accounts aimed at customers under the age of 25 offering a few useful features to help people on their way.
Here’s what to look for when you’re choosing a transaction account for a younger customer, whether this is for you or one of your children.
No monthly fees
When there’s not a huge amount of money coming in every month, every few dollars that’s debited counts. Lots of Australian transaction accounts have monthly fees of between $5 and $10 and while this might not seem much to someone on a full salary, it can mean a lot to a student or someone working part–time or infrequently.
No transaction or ATM fees
Younger people and students tend to make smaller transactions and withdrawals, so if each one costs a couple of dollars, that’s a lot of money disappearing into the ether. Having unlimited fee – free counter, ATM and debit transactions can make a big difference at the end of each month.
No minimum monthly deposit
Someone who picks up a few shifts in a local bar, or who is living on their student loan, isn’t going to be depositing a salary of $2,000 or more each month. Many transaction accounts require a minimum deposit – usually around $2,000 – each month in order to waive the account–keeping fees, so finding one that automatically waives these fees for students or under–25s is handy.
An interest earning rate (even if it’s rather modest)
There are a few transaction accounts that offer a small amount of interest on balances. These interest rates are low compared to high interest savers or term deposits, but if the account holder doesn’t have enough spare cash to start up a saver, it’s something.
Things to watch out for with transaction accounts for younger Aussies
The age limits on the accounts
The age limits are very important with youth accounts. Once you age out of the youth version you might start paying monthly fees or have to maintain a minimum balance in order to waive them. You might be ready to start paying fees, or you might prefer to switch to an account with lower or no fees.
Similarly, once you stop studying, you may no longer be eligible for the account perks, although some youth accounts go up to the age of 25. You should know when you’re due to age out and be ready for it so that you don’t get any surprises.
The methods you can use to access and manage your account
Some transaction accounts have phone, internet, counter, ATM and [email protected] access facilities while others don’t have all of these. It’s important to be able to contact your bank easily, so an account with online access is a bonus, especially for younger people who are permanently connected to wi-fi!
InfoChoice’s pick of transaction accounts for younger Aussies
To help you in your search, InfoChoice has selected its favourite accounts for young people.
The ANZ Access Advantage Account isn’t specifically aimed at the under–25s, but it has some features and perks that make it ideal for their needs. Normally, the account charges $5 each month unless you deposit at least $2,000, you’re a student or aged under 25. You can manage the account over the phone, online or over the counter.
There’s no minimum opening balance or maintenance balance, a daily withdrawal limit of $1,000 and some overseas withdrawal and transaction fees.
The RACQ’s Advantage Plus account does have a minimum opening balance of $2,000, but this doesn’t have to be maintained or grown over the life of the account, so it may work well for a student. There are no monthly account fees or transaction fees at all, apart from some small overseas charges and the daily ATM withdrawal limit is $1,050.
You can manage the account online, over the phone or over the counter and ATM access is fee–free. The Advantage Plus account offers a small interest rate of 0.25 per cent p.a. on balances up $5,000 to $50,000 (you can always aim high!), which is paid quarterly. After $50,000, the interest rate rises to a fairly decent 1.00 per cent p.a.
The Beyond Bank BU Savings account is a transaction account with a 1.00 per cent p.a. rate of interest that’s paid quarterly on balances from as little as $1. There’s no minimum opening balance or maintenance balance, no monthly or transaction fees and you can manage the account online, over the counter or over the phone.
As this account offers interest even on very small balances, this is a good choice for a teen with their first part–time job as it offers a direct debit facility as well as a daily ATM withdrawal limit of $1,500.
The Macquarie Transaction account is another fee–free, no minimum deposit or opening balance account. It offers unlimited electronic transfers, as well as a daily withdrawal limit of $2,000. There’s no overdraft facility with this account, but if the balance does fall below $0, the customer will pay the overdraft rate of 16.40 percent on the overdrawn balance.