What Are Student Savings Accounts and How Do They Work?

Financial wins start with saving money, even for college and high school students. Whether you are saving your allowance or trying to stretch that part-time paycheck, a student savings account could be your new best friend. But what makes this account special? And how do student savings accounts work, anyway? Keep reading to learn about savings accounts for students and how to find the best bank for college and high school students.

What Are Student Savings Accounts?

Student savings accounts are a type of bank account made specifically for—you guessed it—students! Not only do these accounts help young adults save money, but they also have special features that fit the specific needs of students. Many banks design savings accounts for students to be more user-friendly, offering perks like low fees (or no fees at all), low deposit requirements, and flexible terms.

Having a savings account as a student is a great way to develop smart money habits early on. It can act as an emergency fund, covering surprise costs like a laptop breakdown during finals. A student savings account also helps you reach saving goals, whether it's backpacking through Europe, upgrading your gaming setup, or snagging the latest concert tickets. Beyond that, this student bank account is perfect for learning basic financial skills, such as budgeting, understanding interest, and managing fees—all in a manageable way!

How Are Student Savings Accounts Different From Regular Savings Accounts?

While the goal of student savings accounts and traditional savings accounts is the same, student savings accounts typically have qualities that make it easier for students to manage their money—especially since most are new to personal finance. The key factor isn’t necessarily age. Instead, it’s about accommodating your experience with handling money.

Here are the main differences:

• Fee Waivers: Regular savings accounts might hit you with monthly maintenance fees, but banks often waive these for student accounts.
• Minimum Balance? No Thanks! Unlike traditional accounts that require a minimum deposit or ongoing balance, student bank accounts are more forgiving.
• Overdraft Coverage: When linked to a checking account, a student savings account can automatically transfer funds to cover overdrafts.
• Age and Eligibility Requirements: To reap the benefits of student savings accounts, the account holder must be younger than 23 years old. Meanwhile, regular savings accounts are open to anyone regardless of age or student status.

How Do Student Savings Accounts Work?

Understanding student savings accounts is as easy as 1-2-3...4. They work a lot like traditional savings accounts and are primarily meant to keep your money safe. But what sets student savings accounts apart is how they make money management more accessible for young adults. Let’s take a closer look at how student savings accounts work so you can start saving smarter.

1. Simple Set-up

Most banks make it easy to open a student savings account online, and the process usually involves basic requirements. You will need to provide a government-issued ID (like a driver’s license), proof of enrollment in college or high school, and maybe a Social Security Number. For students under the age of 18, a parent or guardian may need to co-own the account.

2. Make Deposits

Once your student savings account is open, the next step is funding it. Most banks let you make your first deposit through a range of methods—such as transferring money from another bank account, depositing checks through mobile banking apps, or visiting a local banking branch in person. After your opening deposit, you continue adding money regularly (or even randomly) to build your savings. The funds may come from a part-time job, gifts, allowances, etc.

3. Earn Interest

One of the best parts of savings accounts is that your money grows over time—just by sitting there. Most student savings accounts earn interest, which means the bank pays you a little extra based on how much money you keep in your account. The more you save, the more you earn. It’s like a small reward for being smart with your money.

4. Access Your Money

When it comes to managing your money, student savings accounts come with options. You can check your balance online and withdraw money using an ATM, mobile banking app, or by visiting a nearby branch. While these accounts are meant for saving—not frequent spending—most banks let you take out money a few times each month. Therefore, you can still use your savings when you really need it while keeping the rest tucked away!

Find the Best Student Savings Accounts at Academy Bank

Whether you are saving for a semester abroad or building an emergency fund, having the best student bank account can be a game-changer. But don’t let yourself feel overwhelmed when you are choosing an account! Just remember the key takeaways from this article: how student savings accounts work and their awesome benefits.

As a financial institution that specializes in student banking for college students and high school students, Academy Bank offers accounts and resources that support young adults.

Here’s why our student savings accounts stand out:

• No Monthly Maintenance Fees: Keep your money where it belongs—with you!
• Low Deposit Requirements: Open an account with just $25. After that, you don’t need to maintain a minimum balance.
• Interest Compounds Quarterly: Your savings earn interest every few months, growing your money over time. (Learn how to calculate compound interest).
• Source of Overdraft Protection: Stay covered by linking your student savings to your student checking. If your checking account balance runs low, we’ll automatically transfer money to help you avoid fees and payment issues. Because everyone loves student bank accounts with overdraft protection!
• 24/7 Digital Banking Access: Manage your account anytime, anywhere with our mobile* and online banking platforms.
• Financial Tips & Tools: Learn how to budget, save, and make smart money moves with user-friendly guides and helpful tools.

Remember, the best banks for student savings accounts make it easy to save, manage your money, and create good financial habits from the very beginning.

Take the first step today!

Open Student Savings Account

WHAT ELSE CAN WE HELP YOU FIND?
Student Checking Accounts
College Savings Calculator
Student Loan Calculator
How to Build Your Credit as a College Student
Finance 101: How to Start Saving