Banking
Basics
As you begin exploring new paths towards financial freedom, we encourage you to increase your financial knowledge along the way. Increasing awareness regarding financial terms and methods can alllow one to effectivley begin credit-building, saving, budgeting, and more.
Checking Account
A bank account into which you deposit funds (cash, the pay from your job, checks). You can access and spend this money when needed.
Savings Account
A savings account allows you to set aside money for longer-term use. The bank pays you a certain amount of interest over time.
Credit Card
Credit cards provide you a line of credit to borrow money. You will pay back the borrowed money plus any applicable interest.
Opening a Bank Account
A bank account is a safe space to store your savings. You can open a Checking Account (and get a Debit Card) for frequent everyday transactions like paying your bills or direct deposits. Or you can open a Savings Account (for long-term savings and therefore, less frequent withdrawals). If you want to access your financial aid money, or deposit checks from your job, a Checking Account is the best option for you.​
Compare Banks
Learn about different bank's monthly fees, minimum balance requirements, ATM access, online banking features, overdraft fees, and interest rates.
Gather ID Documents
You will need to bring a government-issued ID (driver's license, state ID or passport), your social security number, proof of address, and a parent or guardian (if under 18).
Initial Deposit
Most banks require that the applicant (you) make an initial deposit when opening an account with them. The amount can vary by institution, but it is usually around $25.
Apply
You can go to a local branch in person or apply online (if applicable). We recommend going in person to ask any questions and show your documents.
After you get approved, you will need to activate your debit card and set up online banking! Then you can track your spending and start saving!
Building Credit (Credit Cards)
Do you actually need a credit card? Probably not. But if you want to start building your credit score, also known as FICO score, a credit card is a great way to do that. If you plan to buy a car later on, the best time to do that is when you have a higher credit score so banks can offer you a loan at a lower interest rate.
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Credit score criteria is comprised of Payment History (35%); Credit Usage (30%), Length of Credit History (15%), Types of Credit Used (10%), and Any Recently Opened Lines of Credit (10%).
Compare Banks
Look for banks that offer lower interest rates on credit cards (like credit unions). Ask about student accounts (waives monthly fees while you are in school).
Paying Your Credit Card
Golden rule: pay on time and pay in full. The more you wait, the more you pay (the money you owe + interests). Never miss a payment (that is 35% of your credit score).
Check Your Credit
Credit (FICO) score ranges between 300 and 850, with anything above 670 generally being considered "good credit" (and it depends on the criteria outlined above).
Avoid These Mistakes
Do not open too many credit cards. Do not miss any monthly payments. Do not max out your credit card or have a high balance. Do not let anyone else use your card(s).
Credit cards can be a double-edged sword. Learn how to build credit responsibly or it could end up hurting you in the long run.
Budgeting Tips
1
Track Your Income
Know how much money you make (from a part-time job or a monthly allowance). This will be the basis of your budget.
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When you earn more (like when you get a raise, work more hours or get birthday money) increase your savings instead of your spending.
2
List Spending Categories
Make a list of your expenses, for example Monthly Needs (Gas, phone bill, lunch), Memberships (Gym, Netflix, Spotify), Savings (for future purchases or long-term goals).
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Monitor your spending habits by using a printable tracker or spreadsheet.
3
Pick A Strategy
There is the 50/30/20 Rule (50% for bills, 30% for wants and 20% for savings). With Envelope Budgeting you divide your money (once the funds run out in that envelop you can no longer spend in that category). In the Zero-based Budget, you will need to account for every single dollar, leaving a balance of $0.
4
Spend Smart
Consider purchasing high quality items that you will enjoy in the long term (rather than trendy, low-quality ones). Repurpose things you already have and consider shopping secondhand to save you money and the planet!
5
Stick To Your Budget
Do not feel pressured to keep up with the latest fashion trends or overspending every time you hang out with your friends. Your true friends will be happy to spend time with regardless of what you are wearing or how much money you are spending.
6
Use Resources!
If your budget is not working for you, adjust it! We all make mistakes but its important to recognize them and seek help when needed. Listen to your parents, attend financial literacy workshops, maybe your bank or college has experts who can guide you with your finances.
Financial Tools
CalCoast Credit Union (and other financial institutions) offer free resources for current and potential clients.
Enrich features dynamic and interactive financial tools, courses and resources to deliver a highly personalized experience designed just for you.
This virtual no-cost Financial Wellness Center is a one-stop shop where students can drop in for financial information and one-on-one education on topics ranging from budgeting and credit scores to financing a car or even saving for retirement, and much more.