Best Childrens Savings Account

As you teach your children why they need to save, and the importance of waiting until they can afford something to purchase it, you want to make sure you are using the right tools for that teaching, and so you need to choose the best savings account for childrens’ financial needs. To help you make comparisons of savings accounts which would best suit your child, following is all the information you need on the importance of teaching your children sound saving skills, and how you can ensure they follow through on your lessons with the best bank account.

Featured High Interest Savings Account

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• Maximum Rate: 5.51%
• Standard Variable Rate: 4.91%
• Bonus Rate: 0.60%
• Monthly Account Fees: $0
• Minimum Balance: $0
• Minimum Deposit: $0

Read the UBank USaver terms and conditions

Why is it Best for Children to Have Their Own Bank Accounts?

Starting when your child is as young as possible to teach them about money, saving and finances can help them become financially secure adults, and even something as simple as opening a savings account in their name, can have a profound affect on the success of your lessons. Childrens’ savings accounts will allow your child to:

• Learn financial responsibility and banking techniques. If the first time your child withdraws money from the bank is after their first shift of part time work, then they have a lot to learn about money, and they have to learn not to spend everything they earn at the same time they are earning their first real wage. To reduce the temptation to spend every pay cheque as it comes, you need to teach your child about money before they can make any significant mistakes. When your child deposits pocket money or birthday money, they can also learn about saving some and spending some; saving for long term goals, and saving for a shorter term purchase. It is also your chance to teach your child about what really goes into making a bank deposit or how a withdrawal works, and where it comes from.
• Make their own mistakes. Starting your child’s saving education young means you can teach them the theory of how to manage their finances, but it is not until they make their own mistakes that they will grasp the entire concept. Therefore, let them make their mistakes on a smaller scale, when they’re young and you can easily pick them up and dust them off. Let your child determine their own savings amount for the bike they want to buy, and they’ll soon see that a savings goal can be a lot further away if you only make small contributions, and by the time they’ve saved the amount they need, the price may have gone up in the bike store.
• Australians are younger when they need financial independence. Your child is unlikely to stay at home until they’re married, and then save up for the cost of their first home. Instead, young Australians want independence as soon as possible and you want to give your child the tools to gain that independence and put them ahead of the pack. If your child is in a position to buy a small house or an investment property when they begin their career because they have enough in their savings account for the loan deposit, then they can have a secure footing to set out on that career, and lead a stable life because they don’t have to worry about money, or about landlords raising their rent or kicking them out.

How to Choose the Best Childrens’ Savings Account

All of these lessons and scenarios may seem a long way down the track if you have only just started to allocated your child pocket money, but they have an important place in the plan you have for raising a happy and responsible child. For advice on choosing the best bank account for your child, consider these tips:

• Open a bank account for your child, with a parent as joint account holder. If your child is under 12 years old, most high interest savings accounts will require that a parent or guardian act as a joint account holder anyway. As joint account holder you will have access to all information about account transactions, deposits and withdrawals, and you may even choose to set up the account so you have to authorise each transaction. In this way your child has their own bank account to use and manage, and while they make the decisions, you can watch on to ensure they keep their funds safe.
• Teach both online and in branch banking skills. Consider opening a children’s bank account which has both online and branch access, to teach your child the skills of both. It is important to know how to fill out a deposit slip and how to interact with banking staff, just as it is important to know how to keep your internet banking passwords safe, and how to check that a website is secure before you login.
• The best childrens savings account will have an ongoing high rate. No matter what your child’s age, their banking and saving practices will remain inconsistent for some time, so avoid savings accounts which penalise interest rates for withdrawals, and don’t complicate the saving process by choosing an account which rewards your child for regular deposits, these deposit amounts are usually $100 – $200 a month, which is unrealistic for a child anyway. Instead, your child will be much better off with an ongoing high interest rate which is maintained over time.

To make further comparisons of the bank accounts which would suit your child’s saving needs, view our comparison tables here. If you want to teach your child about online banking right away, you can follow our secure links to an online application form and help your child enter their details to open a new savings account today.