Best accounts for an 18 year-old? | General comparisons | Discussion forum

Try Accelerate or Hubert or Oaken or Implicity.
Accelerate and Implicity have Cheques and ATM cards but Accelerate only has one free withdrawal per month.

Really depending on the young man needs. My sons all started with CIBC which is nearby my house. They can have a free account until graduating from University, and a no-fee credit card to build the credit history.

One thing I like CIBC is that they provide free credit alerts for all credit card holders.

Of course, if saving interests are the concern, then there are many high interest accounts discussed in this forum.

It's been mentioned here before that TD Canada Trust allows 12 year-olds to have their own, not in trust, accounts, so legal age of majority appears not to be an issue in opening bank accounts unless the fi chooses to make it one.

AltaRed, the link you provided indicates you can open a TFSA at age 18.

AltaRed, I did not notice it, thanks. So in BC, Newfoundland, New Brunswick and Nova Scotia one has to wait until age 19 to open a TFSA and then can contribute two years' worth of room.

The link for CIBC didn't work for me.
However, their "Youth" account is for people "18 and under". https://www.cibc.com/en/personal-banking/bank-accounts/youth-banking-offers.html
I didn't look into the details.

I did look at TD (before I looked at CIBC). They appear to have youth accounts for age under 19, no fees. There is a chequing account version, which she could use to link to a better-interest account at another FI, but it only allows 2 free transactions per month. This could be worked with, however. Tnagerine has free chequing, for instance, so you could deposit and withdraw additional funds there.
Go to https://www.td.com/ca/en/personal-banking/products/bank-accounts/savings-accounts/youth-account/ and click on Account and Other Related Service Fees pdf at the bottom of the page.
So, I would imagine that all the Big Banks offer a free account through 18 yrs. It needs to be a chequing account in order to link with a higher-paying account elsewhere.

I appreciate what AltaRed is saying about keeping it simple and ensuring that this young person first learns the basics of running her own finances. But we don't know if perhaps she has already learned that from part-time jobs etc.?
We also don't know how adept she might be at managing two different financial institutions. You, her relative, are perhaps the better judge of that. Is she comfortable with arithmetic, percentages, etc? or would she just be humouring you by having more than one financial institution, and then find it all too much trouble? If she's really on board with it, then it could work out fine, but if you're pushing it, maybe not so much. We've had at least one other 18 year old on this site who was very savvy.

Let's say she gets some kind of interim-type job until she decides further about school. How much is she going to be able to save? Depends in part on whether she's living at home, whether she's motivated to squirrel or spend, whether she is saving for something in particular etc. The more she is able to put away and the clearer she is about it, the more worthwhile it would be to have a second financial institution (FI) such as Accelerate, Motive etc.

So, if she's living at home, and is keen on saving, perhaps she'll be able to save enough that the extra percent or two that she can get at a second FI will indeed be worth it to her. But bear in mind that if, for example, she saves $5500 in one year - enough for one year's TFSA contribution - the difference between 1% interest and 2% interest is only $55, and that's for a full year and less as she's accumulating it. Yes, it's twice as much, but is it going to be enough to make her want to bother? I don't know the answer, but it's something for you both to think about. You also need to beware of any costs for having new cheques printed, especially for an account which may only be open for one year. That alone could wipe out any savings elsewhere!

I would actually recommend that you get her to contact CIBC herself and find the answer herself. Part of becoming financially independent is learning to deal with the people who hold your money. If she doesn't follow through, then I would say she's not ready to have two FIs. If she does,then she will have learned and accomplished something, and be ready to move on to the next question.

If she does go ahead with the additional savings account, don't see any reason why she couldn't use one of the MB credit unions as her "savings" bank. Many of us do, and we all live in various parts of the country and don't necessarily have any affiliation with MB. If MB only requires a member to be 18, then so be it! But EQ would be fine too for this purpose, if they accept 18. EQ is, as you probably know, aiming at a youth market and is fast.

Rick, who, I believe, lives in BC, recommended Motive, a division of Canadian Western Bank. It is an online-only bank, and she would still need an external account at bricks and mortar to make it work. I was unable to determine from their website whether they will take clients this age.

The more I think about this, the more I think AltaRed is correct, that it's probably not really worth it at this stage to open another account at a higher-interest FI , unless she already has a nest egg of her own. A kid just out of high school isn't going to earn that much in a year to make it worthwhile unless she has an amazing skill set.