First Service Credit Union has launched an innovative new banking program aimed at children from birth to age 18, emphasizing increasing levels of account features as the children grow and become more financially responsible.
The new program, Discovery Youth Accounts, is designed to foster a sense of financial independence among the young savings and checking account holders, increasing that independence as they get older.
Discovery Youth Accounts are offered in three tiers – Adventurer, for children up to age 10; Voyager, for children 11 to 14, and Navigator, for young people from 15 to 18. The account holders are automatically moved up to the next tier on the appropriate birthday.
What makes Discovery Youth Accounts different is the way it confers more independence and responsibility on the children as they move up through the age tiers, explained Mike McWethy, Executive Vice President of First Service Credit Union.
“If you look at most credit union programs aimed at these age groups, they have a very ‘young’ feel to them, with a lot of cartoon characters, for instance,” said McWethy. “That may be fine for the youngest children, but it doesn’t interest teenagers. We designed Discovery Youth Accounts to emphasize activity and the outdoors, in a way that can appeal to every child.”
All the accounts offer free online and mobile banking, and First Service will reward account holders by paying them – depositing money into their accounts – for good grades. Once children move into the middle age tier, the Voyager accounts, they will be able to set up their own online web page, in GoFundMe crowdfunding website style, in a feature coming in 2016. That will allow relatives and friends to easily contribute to the youngster’s account.
“If Grandma or Grandpa want to give a monetary gift to their grandchild, for instance, they can do it through that page rather than writing a check or buying a Savings Bond,” McWethy explained. “The children can also designate special things they might be saving for and highlight that on their web page.”
As they move into the Navigator accounts, the next level of responsibility gives the teenagers their own checking account and debit card, further helping them to learn good financial habits. The debit card is designed so it can’t be overdrawn, so there will never be a concern about overdraft fees.
“Most youth accounts are set up so that the parents run the account. We set up our Discovery Accounts with features that are focused on the children. We provide tools that help them initiate and drive their own savings and increasingly discover good financial habits and independence,” McWethy said.