A children\’s savings account is a type of bank account that is specifically designed for children. These accounts typically offer higher interest rates than standard savings accounts, and they may also come with features that are aimed at helping children learn about saving money.
There are many different children\’s savings accounts available in the UK, so it is important to compare them before you choose one. Some of the factors you should consider include the interest rate, fees, restrictions, features, online banking, and customer service.
Why Is It Important To Save For Your Child\’s Future?
There are many reasons why it is important to save for your child\’s future. Here are a few of the most important ones:
- To help your child pay for their education.
- To help your child buy their first home.
- To help your child start their own business.
- To provide a financial cushion for your child in case of an emergency.
- To give your child a head start in life.
Best Banks for Children\’s Savings Accounts in the UK
Here are some of the best banks for children\’s savings accounts in the UK:
- HSBC My Savings
- Yorkshire Building Society
- Halifax Kids\’ Monthly Saver
- Saffron Building Society Children\’s Regular Saver
- Nationwide FlexOne Junior Account
- Starling Bank Kite
- Monzo Current Account
- Bank of Scotland Under 19\’s Account
- The Co-operative Bank Current Account
- Atom Bank Junior Saver
- Skipton Building Society My First Saver
1. HSBC My Savings
HSBC My Savings is a children\’s savings account that offers a competitive interest rate of 5% on balances up to £3,000. There are no monthly fees, and you can make unlimited withdrawals. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 18.
Advantages:
- Competitive interest rate
- No monthly fees
- Unlimited withdrawals
- Can be opened online or in branch
Disadvantages:
- Minimum deposit of £1
- Only available to children under the age of 18
2. Yorkshire Building Society
The Yorkshire Building Society offers a children\’s savings account called My Savings. The account offers an interest rate of 4.55% on balances up to £1m.
There are no monthly fees, and you can make up to 12 withdrawals per year. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 17.
Advantages:
- Competitive interest rate
- No monthly fees
- Up to 12 withdrawals per year
- Can be opened online or in branch
Disadvantages:
- Minimum deposit of £1
- Only available to children under the age of 17
3. Halifax Kids\’ Monthly Saver
Halifax Kids\’ Monthly Saver is a children\’s savings account that offers a fixed interest rate of 5.50% for 12 months. The account requires a monthly deposit of £10 to £100.
There are no fees for setting up the account or making withdrawals. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 15.
Advantages:
- Competitive interest rate for 12 months
- No monthly fees
- No minimum deposit
- Can be opened online or in branch
Disadvantages:
- Interest rate reverts to 0.1% after 12 months
- Monthly deposit requirement
- Only available to children under the age of 15
4. Saffron Building Society Children\’s Regular Saver
Saffron Building Society Children\’s Regular Saver is a children\’s savings account that offers a variable interest rate of 5.8%. The account requires a monthly deposit of £10 to £250.
There are no fees for setting up the account or making withdrawals. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 17.
Advantages:
- Competitive interest rate
- No monthly fees
- No minimum deposit
- Can be opened online or in branch
Disadvantages:
- Interest rate is variable
- Monthly deposit requirement
- Only available to children under the age of 17
5. Nationwide FlexOne Junior Account
Nationwide FlexOne Junior Account is a children\’s savings account that offers an interest rate of 3.5% on balances up to £10,000. There are no monthly fees, and you can make up to 6 withdrawals per month. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 16.
Advantages:
- Competitive interest rate
- No monthly fees
- Up to 6 withdrawals per month
- Can be opened online or in branch
Disadvantages:
- Minimum deposit of £1
- Only available to children under the age of 16
6. Starling Bank Kite
Starling Bank Kite is a children\’s savings account that offers an interest rate of 2.00% on balances up to £2,000. There are no monthly fees, and you can make unlimited withdrawals. The account can be opened online by a parent or guardian on behalf of any child under the age of 18.
Advantages:
- Competitive interest rate
- No monthly fees
- Unlimited
- Withdrawals
- Can be opened online by a parent or guardian on behalf of any child under the age of 18.
Disadvantages:
- Minimum deposit of £1
- Only available to children under the age of 18
- No interest on balances over £2,000
7. Monzo Current Account
Monzo Current Account is a children\’s current account that offers an interest rate of 0.10% on balances up to £1,000. There are no monthly fees, and you can make unlimited withdrawals. The account can be opened online by a parent or guardian on behalf of any child under the age of 18.
Advantages:
- No monthly fees
- Unlimited withdrawals
- Can be opened online
Disadvantages:
- Low interest rate
- Only available to children under the age of 18
8. Bank of Scotland Under 19\’s Account
Bank of Scotland Under 19\’s Account is a children\’s current account that offers an interest rate of 0.01% on balances up to £1,000. There are no monthly fees, and you can make unlimited withdrawals. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 19.
Advantages:
- No monthly fees
- Unlimited withdrawals
- Can be opened online or in branch
Disadvantages:
- Low interest rate
- Only available to children under the age of 19
9. The Co-operative Bank Current Account
The Co-operative Bank Current Account is a children\’s current account that offers an interest rate of 0.01% on balances up to £1,000. There are no monthly fees, and you can make unlimited withdrawals. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 18.
Advantages:
- No monthly fees
- Unlimited withdrawals
- Can be opened online or in branch
Disadvantages:
- Low interest rate
- Only available to children under the age of 18
10. Atom Bank Junior Saver
Atom Bank Junior Saver is a children\’s savings account that offers an interest rate of 3.50% on balances up to £5,000. There are no monthly fees, and you can make unlimited withdrawals. The account can be opened online by a parent or guardian on behalf of any child under the age of 18.
Advantages:
- Competitive interest rate
- No monthly fees
- Unlimited withdrawals
- Can be opened online
Disadvantages:
- Minimum deposit of £1
- Only available to children under the age of 18
11. Skipton Building Society My First Saver
Skipton Building Society My First Saver is a children\’s savings account that offers an interest rate of 3.50% on balances up to £1,000. There are no monthly fees, and you can make unlimited withdrawals. The account can be opened online or in branch by a parent or guardian on behalf of any child under the age of 18.
Advantages:
- Competitive interest rate
- No monthly fees
- Unlimited withdrawals
- Can be opened online or in branch
Disadvantages:
- Minimum deposit of £1
- Only available to children under the age of 18
How to Choose the Best Children\’s Savings Account for Your Child
When choosing a children\’s savings account, there are a few factors you should consider, including:
- Interest rate: The interest rate is the percentage of your savings that the bank will pay you back each year. A higher interest rate means you will earn more money on your savings.
- Fees: Some children\’s savings accounts have fees for things like setting up the account or making withdrawals. It is important to choose an account with no or low fees.
- Restrictions: Some children\’s savings accounts have restrictions on how often you can make withdrawals or how much money you can deposit. Make sure to choose an account that will meet your child\’s needs.
- Features: Some children\’s savings accounts offer features like online banking or the ability to set up regular savings plans. Choose an account with features that will make it easy for you and your child to manage their savings.
- Online banking: Online banking makes it easy to check your child\’s balance, make transfers, and set up alerts. Choose an account that offers online banking that is easy to use.
- Customer service: If you have any questions or problems with your child\’s savings account, you will need to be able to get in touch with customer service. Choose an account with customer service that is responsive and helpful.
Tips for Teaching Your Child About Saving Money
The best way to teach your child about saving money is to set a good example. Talk to your child about the importance of saving and show them how you save money. You can also help your child set savings goals and track their progress.
Here are some other tips for teaching your child about saving money:
- Make saving fun: There are many ways to make saving fun for kids. You can start a piggy bank, set up a lemonade stand, or create a savings chart.
- Set goals: Help your child set savings goals, such as saving for a new toy, a bike, or a vacation. This will give them something to work towards and help them stay motivated.
- Track progress: Help your child track their progress towards their savings goals. This will help them see how their savings are growing and keep them motivated.
- Reward savings: When your child reaches their savings goals, reward them with something special. This will help them associate saving with positive experiences.
By following these tips, you can help your child learn the importance of saving money and develop good financial habits that will last a lifetime.
Frequently Asked Questions
Here are some FAQs about children\’s savings accounts:
1. What is the best age to open a children\’s savings account?
There is no one-size-fits-all answer to this question, as the best age to open a children\’s savings account will vary depending on your child\’s individual circumstances. However, many experts recommend opening an account when your child is young, so that they can start building good saving habits early on.
2. How much money should I save for my child?
The amount of money you save for your child will depend on your financial circumstances and your child\’s individual needs. However, a good rule of thumb is to save at least 5% of your income each month.
3. Can I open a children\’s savings account with any bank?
Yes, you can open a children\’s savings account with any bank. However, it is important to compare different accounts before you choose one, as the interest rates and fees can vary.
4. What are the tax implications of saving for my child?
The tax implications of saving for your child will depend on your individual circumstances. However, in general, any interest earned on a children\’s savings account is tax-free up to a certain amount.
Final Thought
When choosing a children\’s savings account, there are a few factors to consider, such as the interest rate, fees, restrictions, features, online banking, and customer service. The best account for your child will depend on their individual needs and goals.
It is very good to start saving for your child early so that their money has time to grow. You can help your child learn about saving money by setting a good example, making saving fun, setting goals, tracking progress, and rewarding savings.
By following these tips, you can help your child develop good financial habits that will last a lifetime.
I hope this article has helped you learn more about children\’s savings accounts in the UK. If you have any further questions, please feel free to leave a comment below.
Thanks for reading!