As a mom of three and a financial advisor, I’ve seen firsthand how essential it is to teach kids about budgeting, saving, and financial responsibility. Equally important is educating them on what not to do, and here’s a prime example: a dangerous trend is circulating on social media, encouraging people to exploit a supposed “bank glitch” to withdraw free cash from ATMs. While this may seem harmless in viral videos, it is actually bank fraud and can lead to serious legal trouble for you or your kids.
- The “Bank Glitch” Trend Is Fraud
So, here’s what this is. This viral trend involves depositing fake checks into an ATM and then withdrawing the money before the bank catches on that the check is fraudulent. The scam may seem like an easy way to make quick money, but it’s not just a glitch in the system — it’s totally illegal. This practice, known as check-kiting, is a serious crime that banks monitor closely. Even for first-time offenders, the consequences can include jail time, fines, and a criminal record. This is just plain bad news.
As a financial advisor, I can’t stress enough how quickly something that looks like a simple hack can spiral into life-altering consequences. If you or your kids get caught up in this, the penalties will far outweigh any short-term gain.
- Your Financial Future Could Be at Risk
Participating in this scam can lead to your bank accounts being frozen or even closed permanently. Understandably, banks have zero tolerance for fraud, and once flagged, your financial and banking options become severely limited. I like to use the analogy of bad behavior on a flight, once you’re on the no-fly list, you’re facing long-term travel challenges. Losing access to your bank account can disrupt everything from paying bills to receiving your paycheck. And it doesn’t stop there — your ability to open future accounts or apply for credit cards, loans, apply for a job, buying a car, renting an apartment, or even a mortgage could be compromised.
As a financial advisor mom, I think about the long-term potential as well as the implications of every financial decision, not just for myself but for my kiddos. This is our opportunity to set a positive example by showing them that quick fixes rarely lead to lasting success and often come with serious repercussions. Earning honest, consistent income/pay should be the goal.
- Misinformation on Social Media
With TikTok, Instagram video, and other platforms becoming popular sources of financial advice, it’s easy to get swept up in viral trends that promise “easy money.” I try to introduce my kids to other established business and financial outlets to help balance what they’re seeing. According to Forbes, over 80% of young adults turn to social media for financial guidance. Unfortunately, many of these viral financial hacks, including this one, are misleading at best and downright dangerous at worst.
As a financial pro, I regularly warn my clients, and even my own kids, about the risks of trusting financial advice from unverified sources. If something sounds too good to be true, it almost always is. The creators of these viral videos may be promoting clickbait or scams or incomplete info just for views and engagement, leaving you to deal with the fallout if you take their advice.
- Short-Term Gains Can Lead to Long-Term Consequences
Even if this scam works for some people initially, the fallout could be devastating. It’s not worth the risk. You could find yourself facing legal trouble, including being held liable for any money you withdraw, on top of hefty fines. Instead of a quick windfall, you could be stuck with massive debt and a tainted financial history that follows you for years. FULL STOP.
- Teach Your Kids What Not to Do
As parents, we want to give our children the tools they need to succeed in life, and that includes teaching financial best practices and helping lead them to financial independence. I want my children to understand that wealth is built gradually, through smart decisions, hard work, and ethical behavior, not by gaming the system.
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Safer, Smarter Alternatives
Instead of falling for schemes like the “bank glitch,” I like the idea of focusing on on other ways to financially level up. Here are a few of my favorites:
– Side hustles: Do you have a budding entrepreneur at home? I like talking business opportunities with my kids. Explore flexible work opportunities, such as freelancing, tutoring, babysitting, or selling handmade products or things you no longer need online on places like Facebook Marketplace or Ebay.
– Budgeting and saving: Teach your kids and yourself the power of setting financial goals and sticking to a budget. Set up a “family vacation fund” and have everyone pitch in and decide on a destination together.
– Learn about saving for the future: Did you know it’s never too early to save for your retirement? Yup, my kids have already started and yours could too. Check out my recent thoughts on the powerful Roth IRA.
A Roth IRA offers tax deferral on any earnings in the account. Qualified withdrawals of earnings from the account are tax-free. Withdrawals of earnings prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Limitations and restrictions may apply.
– Building an emergency fund: Start small, but make a plan together to save enough to cover unexpected expenses, providing financial security without the temptation of risky decisions. For kids, start with a month of expenses as a savings goal and go up from there. Once they’ve saved 3-6 months, you could even look into meeting with a financial advisor and setting up some financial planning. That’s what I’ve done with my teen.
The “bank glitch” trend may seem like a harmless or clever way to make money, but the consequences — both legal and financial — are just too high. Stay safe, stay informed, and don’t let the lure of quick money lead to long-term regrets.
