Yes, a teenager can open a savings account at almost any bank or credit union, but in nearly every case an adult has to be on the account as a joint owner until the teen turns 18. No federal law bars minors from holding savings accounts; the adult requirement exists because minors generally cannot enter binding contracts on their own, and a bank account is a contract.1OCC. Guidance to Encourage Financial Institutions Youth Savings Programs and Address Related Frequently Asked Questions A few states allow minors to open deposit accounts solo, but most banks require joint ownership with a parent or guardian regardless.
Why an Adult Has to Be on the Account
Under common law, a contract signed by someone under the age of majority is voidable. The minor can walk away; the other party cannot. A bank that opened an account in a teen’s name alone would have no legal recourse if the teen later cancelled the agreement and left behind unpaid fees or a negative balance. Adding an adult co-owner solves the problem, because the adult is bound by the contract and shares full liability for the account, including any overdrafts the teen runs up.
The FDIC requires each co-owner of a joint account to sign the signature card or otherwise appear in the bank’s deposit records as a co-owner.2FDIC. Financial Institution Employee’s Guide to Deposit Insurance – Joint Accounts That co-owner has to be a legal adult, which means 18 in most states and 19 or 21 in a few others.
Joint Savings Account or Custodial Account
Banks and credit unions typically offer two very different structures for a young person’s money, and the choice matters.
A joint savings account gives both the teen and the adult equal ownership and equal access. Either person can deposit or withdraw at any time. The money is not an irrevocable gift to the teen, and the adult can be removed from the account once the teen turns 18. This is the common choice for everyday savings from a part-time job, allowance, or gifts.
A custodial account under the Uniform Transfers to Minors Act (UTMA) or Uniform Gifts to Minors Act (UGMA) works differently. An adult donor makes an irrevocable gift to the minor; the custodian manages it, but the money legally belongs to the child from day one, and the custodian cannot take it back. When the minor reaches the state’s termination age — typically 21, with a range from 18 to 25 and as high as 30 in some states — the young adult takes full control and the custodian’s role ends.3Cornell Law School Legal Information Institute. Uniform Transfers to Minors Act
For a teen who just wants a place to put paychecks and birthday cash, a joint savings account is simpler and more flexible. Custodial accounts fit better when relatives want to transfer larger gifts or longer-term investments to a child.
What You Need to Bring
Federal rules require every bank to run a Customer Identification Program on anyone opening an account. At minimum, the bank must collect four pieces of information from each account holder: full legal name, date of birth, residential address, and a taxpayer identification number (Social Security number or ITIN).4eCFR. 31 CFR 1020.220 – Customer Identification Program Requirements for Banks Both the teen and the adult co-owner have to provide all four.
Each person also needs documents to verify identity, and the acceptable list differs by age.
- The adult brings an unexpired government-issued photo ID, usually a driver’s license or passport. Some banks ask for proof of address as well, such as a utility bill or lease.
- The teen, who usually does not have a driver’s license or passport, can typically present a birth certificate, Social Security card, or school ID. The exact combination varies, so call the branch before you go.
If the teen is not a U.S. citizen, banks can accept an ITIN in place of a Social Security number along with a foreign passport or other government ID. Not every bank accepts those alternatives, so confirming in advance is worth the phone call.
How the Account Gets Opened
Most banks let you start the application online, but a minor’s account usually requires at least one in-person visit so both the teen and the adult can sign the signature card and have their identities verified. A few institutions handle the whole process digitally with electronic signatures and uploaded documents.
On the application, use full legal names exactly as they appear on identification; mismatches slow things down. The teen is the primary account holder and the adult is listed as the joint owner. Many banks offer youth-specific savings products with low or no minimum balance and no monthly maintenance fee, and that is usually the right pick.
You will need an initial deposit to activate the account. Some youth accounts open with as little as $5; others ask for $25 or more. Cash at the teller window, an electronic transfer, or a check all work at most branches. Applications are typically approved within a few business days, and any debit or ATM card arrives by mail within seven to ten business days.
Who Can Take Money Out
On a joint savings account, both the teen and the adult co-owner have full access. Either can deposit or withdraw without the other’s permission.5Consumer Financial Protection Bureau. A Joint Checking Account Owner Took All the Money Out and Then Closed the Account Without My Agreement A parent listed on the account can legally withdraw the whole balance, and so can the teen.
In most families this never becomes an issue, but it is worth being clear-eyed about the arrangement. A joint account does not give the teen exclusive control over their savings. When the co-owning adult is a non-custodial parent or a more distant relative, this shared access is worth a conversation before signing anything.
Many banks soften the sharp edges with digital tools. Transaction alerts, spending notifications, and parent-teen dashboards let an adult keep an eye on activity without logging in as the teen.
Fees and Overdraft Protection
Youth savings accounts commonly waive the monthly maintenance fee and skip the minimum balance requirement. These perks usually last until the account holder turns 18, though some banks extend them through college age, up to 24. After that cutoff, the account may convert to a standard product with regular fees, so ask about the transition when you open it.
Federal law adds a useful layer of protection on top. Under Regulation E, a bank cannot charge overdraft fees on ATM withdrawals or one-time debit card purchases unless the account holder has specifically opted in to the bank’s overdraft service.6Consumer Financial Protection Bureau. Regulation E – 1005.17 Requirements for Overdraft Services If you never opt in, the bank simply declines transactions that would overdraw the account. For a teen’s first savings account, staying opted out is generally the safer call.
Taxes on Interest the Account Earns
Interest earned in a teen’s savings account is taxable income, even for a minor. For most teens with a basic savings balance, the interest will stay small enough that no return is required, but the thresholds are worth knowing.
- Under $1,350 in unearned income for 2026: the teen does not need to file a federal return based on this income alone, because the standard deduction for a dependent with only unearned income covers the first $1,350.7Internal Revenue Service. Revenue Procedure 2025-32
- Between $1,350 and $2,700: a return may be required, with the income above $1,350 taxed at the teen’s own rate.
- Over $2,700: the kiddie tax kicks in, taxing the excess at the parent’s marginal rate. The teen files Form 8615 with the return.8Internal Revenue Service. Topic No. 553, Tax on a Child’s Investment and Other Unearned Income (Kiddie Tax)
If the teen also has investment income from a custodial account, inherited assets, or large gifts, the total can cross those thresholds faster than you would expect.
What Changes When the Teen Turns 18
Reaching the age of majority changes the legal relationship with the bank. The young adult can now enter contracts alone and no longer needs a co-owner. What happens to the account depends on which type it is.
- Joint savings account: most banks let you remove the adult co-owner once you turn 18 and convert the account to an individual account. Some do it automatically; others require a branch visit and new signature documents. Any youth-account fee waivers may end at 18, so check whether the account converts to a standard product with fees or balance requirements.
- Custodial account: the custodian’s authority ends at the state’s termination age, typically 21 but anywhere from 18 to 25 depending on the state. The account is re-registered in the young adult’s name and they take full control of the assets.
Turning 18 is also a good moment to compare interest rates, fees, and features across banks and credit unions. The youth-account universe is narrow; the adult-account universe is not, and a higher-yield account can add up as savings grow.