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4 Great Checking Accounts for College Students

College freshmen are striking out on their own for the first time in their lives. It's a time to push boundaries, explore interests and probably make one or two slightly reckless choices (you can finally get that tattoo) now that mom and dad aren't there to be vigilant watch dogs. But there is one area students can accidentally get into some serious trouble: their finances. It only takes a few missteps to generate four or five digit credit card debt or pay hundreds of dollars in senseless bank fees.

Here are four checking account options for students -- and parents -- that can help avoid fees and negate bad money decisions.

Free From Fees

Bank of Internet USA is an online-only bank account that offers a truly no fee option. The Rewards Checking Account offers no overdraft or non-sufficient funds fees. You can set up overdraft protection for free and won't get charged to move money out of your savings account and into your checking account. There are no minimum account balance fees or monthly maintenance fees. Bank of Internet USA even refunds ATM fees. If you're charged a fee by another domestic bank, Bank of Internet USA will deposit a refund in your checking account by the next day.

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One word of warning to college students about this account: Don't chase rewards. The checking account offers tiered interest up to 1.25 percent APY. However, there are a few hoops to jump through to get the full 1.25 percent, and it simply isn't worth focusing on or potentially overspending to earn that rate.

Easy for Parents to Send Money

Bluebird by American Express, created in partnership with Wal-Mart, could be the solution for parents who feel their child isn't ready to have complete control over a checking account just yet.

With Bluebird, there are no monthly or annual fees, no overdraft fees (transactions are declined instead) and no inactivity fees or card replacement fees. There are also no ATM fees if you use a MoneyPass ATM or the Money Center Express machine at Wal-Mart. Otherwise, there is a hefty $2.50 American Express fee on top of the ATM network surcharge.

The biggest perk for parents is the family accounts feature. Each family member will get a card with his or her name on it, and it's free and simple for parents to transfer money to college students to cover books, groceries or whatever parents are willing to financially support. Because the student can't overdraft, parents won't incur excessive fees from mismanaged money.

Good for Going Abroad

College students interested in studying abroad should consider opening a Charles Schwab High Yield Investor Checking Account. This account is part of the Charles Schwab online banking portfolio and comes with no monthly service fees, no account minimum and free overdraft protection when linked to a Charles Schwab brokerage account or savings account.

The best part for students studying abroad is the unlimited ATM reimbursement feature. Charles Schwab will reimburse all fees (both domestic and international) from ATMs that accept your Charles Schwab debit card. This makes access to cash cost-effective and simple for students living in foreign countries. There are also no foreign transaction fees when you swipe your debit card abroad. However, it would be in your best interest to get a credit card with no foreign transaction fees just in case your information gets skimmed. It's much less of a headache to deal with credit card fraud than debit card fraud because the latter gives thieves direct access to funds in your bank account.

The one issue with Charles Schwab is the overdraft policy. Checking accounts with overdraft protection could overdraft without any fee, assuming there are funds in the linked account. However, accounts without overdraft protection or without sufficient funds to cover the transfer will be charged $25 per transaction, up to $100 per day. If you're looking to take advantage of the unlimited ATM reimbursement, just be sure you don't overdraft.

Great Customer Service

Ally Bank offers a mostly fee-free account with its Interest Checking Account. There is no minimum to open an account and no monthly maintenance fee. The overdraft fee is $25 with a maximum of one charge per day. Overdraft protection is free. Ally customers can use any Allpoint ATM for free, but if there isn't an Allpoint ATM near campus, Ally will refund up to $10 in ATM fees per statement cycle. Ally also provides 24/7 customer service so any banking problems can be resolved quickly.

Evaluate the Fine Print Before Setting Up an Account

Teaching college students healthy financial behaviors is the key to ensuring their success with money. But freshmen (and even upperclassmen) need training wheels. Finding the right bank account and reading all the fine print is one way to ensure their money stays protected, and they learn how to handle money without getting smacked with big fees.

Erin Lowry writes about personal finance and serves as the content director for MagnifyMoney.com, a site dedicated to helping consumers save money by finding simple and transparent financial products. She is also the founder of the personal finance blog Broke Millennial.



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