Number 1 Son has accumulated a small amount of savings, encouraged by the several banks with which we have had accounts. Children’s savings accounts are usually free of charges to get the child into the habit of thrift.

Until your son or daughter turns 18, that is. Then, they are fair game.

My son’s story began a few months ago when UBOC sent him a letter saying that they were automatically converting his student savings into a checking account with monthly fees. He is astute enough to know that those fees would relentlessly eat into his hard earned funds. He went down to the local branch of UBOC to ask if there was a better option. Nope.

So, he began the not so simple task of finding another bank. His original plan involved moving to a bank that also had a branch where he would be going to college. That limited the choices.

A few internet searches later, he found what semed to be the prime candidate, WaMu. The WaMu website was offering free checking and 5% on a savings account with a very minimal balance. Eureka!

He went down to the local branch to get more details. I tagged along to see what would happen. The New Accounts rep reassured my son that he could open the checking account at the branch and still get the high interest on his savings. (The website said the special rate only applied to accounts opened online.)

Being a person who likes to talk with people who take his money, he closed his account at UBOC and went back to WaMu the following Saturday to open the new accounts in person.  A different account rep opened the accounts. Being far too trusting, neither my son nor I questioned this account rep about the rates.

The first statement arrived — 0.25% on the savings account. With inflation running at 4%, this pitiful rate is just like having monthly fees erode the balance.

We went back to the branch. Both account reps insisted that no one ever told us that we would get the 5% by opening the accounts at their branch office. I asked to speak to the manager.  The assistant manager was available.

The assistant manager was friendly and polite. My son explained that he was college bound, needing a checking and savings with the best possible rates. The manager reiterated that the only way to get the best rate is to open the account online and gave instructions to my son on what to do. He would open new accounts online and transfer the money to them. It seemed simple enough . . . until he actually tried to do it.

Online, Number 1 Son discovered that the account rep had put in the wrong email address, accidentally dropping the final letter off of his name. He went into his account to change it.

But when he went to open the new account, it wouldn’t work. Even answering all of the security questions didn’t get it to work. He repeated his attempts several times until the bank computer turned off his active account for potential identity theft activity. Calls to the assistant manager didn’t provide any help. The solution — wait seven days and try again.

“Oh, also, you may want to check your credit report in case someone has tried to steal your identity, ” the assistant branch manager suggested.

Could that be possible? I showed my son how to order his free online credit report. Experian wouldn’t give him anything. Equifax wouldn’t give him anything. TransUnion had the good graces to say that they didn’t have anything on file for him.

Of course not! He hasn’t had any credit accounts or loans  in his name.  This was a clue.

Seven days later, my son tried again to open an online account. After his first attempt failed, I suggested he call WaMu’s online help center before the bank computer did another security lock down. A very pleasant person informed him that the computer wouldn’t open an online account unless it could verify his identity from drivers’ license records and credit verification.

A giant computer rules WaMu making all the decisions and the people just work for the computer.  No one can override the computer.

There was no way for my son to get the high interest account. Why didn’t they tell us that from the start? I don’t think the computer tells the workers at WaMu what the rules are–for security purposes.

Bank of America and Wells Fargo both have special college banking programs. A student can get a checking account with fees waived based on certain criteria. And, they’ll give your college student a credit card in addition to the debit card attached to the checking account. Oh, by the way, BofA and WF would love to consolidate your student loans, too.

Is there an equivalent savings account for college students? Certainly not.

What is the return on a regular savings account with fees? 0.1%

This seems so shortsighted! Who will have saved downpayments to buy homes (and take out home loans) if every college graduate only has loans and credit card debt? Saving money regularly is an important discipline that every person needs to develop. Otherwise, you can fall into the debt trap and not be able to get out.

For the banks, debt means profits. Banks are creating a new generation of debtors without a thought to the consequences. It brings to mind Michael Douglas’ s speech in “Wall Street” – “Greed is good . . .”