Which Savings Account is Best for Your Kids?

One of the greatest things you can do is to open savings accounts for your kids and teach them financial responsibility at a young age. Savings account for children can go a long way toward equipping your wards with financial prudence. This is why you should find out which savings account is best for kids.

Savings Accounts for Your Kids

Teaching your children financial responsibility from a young age can help them reap incredible benefits later in life.

Kids’ savings accounts are savings accounts that can be opened at most traditional banks and credit unions on behalf of a child.

They must be opened jointly so that both the child’s and parent or guardian’s names are on the account.

Many have no minimum age requirement, although as the child ages, they may have to shift their funds to youth, student, and eventually, adult savings accounts.

10 Online Savings Accounts for Your Kids

Here are the top 10 online savings accounts to consider for your lovely kids.

1. Alliant Savings Accounts

Alliant’s online kid’s savings account is available for children 12 years and younger.

Even if you don’t work for an employer linked to Alliant Credit Union, you can still pay $5 and Alliant will donate it on your behalf to Foster Care to Success so that you’re eligible to open an Alliant account.

Alliant has educational content on its site and encourages children to use the Alliant Mobile Banking App to learn about banking firsthand.

Also, Alliant offers custodial accounts, a 529 plan to help save for educational expenses or a traditional kids savings account.

Alliant Credit Union partnered with Visa to offer “The Money Guide,” an introduction to money management for kids ages eight to 12.

Through a collection of games, calculators, worksheets, and podcasts, your kids will learn the basics of budgeting, saving, and borrowing — and how to apply these topics to their everyday lives.

2. Capital One Savings Accounts

Savings Accounts for Your Kids

Capital One offers a good APY on savings accounts and doesn’t charge fees or require a minimum deposit requirement, which makes it a solid choice for a kid’s savings account.

This bank also has a mobile app that your child can use to look up information on their account, but they’ll need a parent or guardian’s help to move money in or out of the savings account.

You can also set up automatic deposits, set savings goals, and link accounts.

Making a deposit is simple; you just upload a photo of a check through the app or mail it to the bank in an envelope.

Capital One has excellent online customer support and is available 24/7 via phone and Twitter.

3. Chase Bank Savings Accounts

Chase savings account for people younger than 18 comes with no monthly fee and a small minimum deposit requirement of $25.

It offers all the regular benefits and features of a savings account, allowing children to understand banking transactions while establishing their financial history.

Chase also has online guidance, tools, and lessons that parents can use to help children develop good money habits at any age.

4. PNC Savings Accounts

PNC offers “S is for Savings” accounts, which are directly targeted at younger children.

While the APY rate on those accounts is low, there are no monthly fees for anyone under 18, and PNC offers online tools featuring Sesame Street characters to help your child learn about savings and money.

PNC breaks their information in the app down into three categories: saving, sharing, and spending.

There are also online activities you and your child can do together to help them learn about money.

While the interest rate isn’t as high as some, the online education features make PNC worth a look.

You can also take advantage of goal-setting options and you have an unlimited number of deposits available with this bank.

5. TD Bank Savings Accounts

TD Bank’s children’s savings accounts are really just an everyday savings account but they waive the monthly maintenance fee and minimum daily balance requirements for savers aged 18 or younger.

Other perks include free automatic transfers from other accounts and earning interest on the savings account.

6. Ally Savings Accounts

Savings Accounts for Your Kids

Ally doesn’t offer designated savings accounts for kids, but this bank is still an excellent choice due to the high APY that comes with opening a savings account.

Ally’s savings accounts don’t require a minimum deposit requirement, nor are there any fees, and you can get up to six transactions per statement cycle.

This bank also offers the Ally mobile banking app so that you and your child can keep track of their account balances and the interest they’ve earned.

Ally also received second place in overall satisfaction, according to the J.D. Power 2019 Direct Banking Satisfaction Study.

Their site offers customers a ton of financial tools, as well as information about financial planning and goal setting.

The only caveat is that if you want to open a savings account for your child, you will have to put the savings account in your name because Ally does not offer joint accounts.

7. Bank of America Savings Accounts

The Bank of America kid’s account can be opened for children younger than 18 at a branch with a $25 minimum deposit.

There is no monthly fee and no minimum daily balance required, but it needs to be jointly owned by the minor and a parent/guardian.

Bank of America also offers a Custodial (UTMA) Savings Account that gives them control of the account as a gift for when a child reaches maturity.

Fees apply for this account if the minimum daily balance is not met. Bank of America’s site also has educational content teaching children about money.

8. Chase Bank Savings Accounts

Chase savings account for people younger than 18 comes with no monthly fee and a small minimum deposit requirement of $25.

It offers all the regular benefits and features of a savings account, allowing children to understand banking transactions while establishing their financial history.

Chase also has online guidance, tools, and lessons that parents can use to help children develop good money habits at any age.

9. USALLIANCE Federal Credit Union

Children earn $10 in “Birthday Bucks” (on USAlliance) each year with this savings account.

The account transitions into EITHER a MyLife Teen Checking account or a MyLife Savings account when the child turns 13.

The USALLIANCE Federal Credit Union website has a budgeting aid and a Financial Education page that has a Student Center.

10. Fifth Third Bank Savings Accounts

Fifth Third Bank’s Goal Setter Savings Accounts are ideal for teaching children how to save and budget.

One of its unique advantages is the Savings Account Bonus feature that allows customers to set a savings goal and, once that goal is met, Fifth Third will give them a one-time savings account bonus toward their next goal.

They also offer competitive savings account rates and a low monthly service charge of $5.

Is a kid’s Savings Account Right for you?

Savings Accounts for Your Kids

Whether or not a kid’s savings account is right for you depends on your goals.

These accounts can be a wonderful option for teaching your child to save early on and giving them a sense of ownership over the money they save.

However, if you’re looking for the best returns on your savings, there are better options. For college savings, tax-deferred accounts like a 529 plan are a wise choice.

If you’re planning on helping your kids save for the long run, consider investments like bonds, brokerage accounts, or a CD ladder.

Even if you’re only concerned with short-term savings, a regular high-yield savings account will probably get you higher rates than any kid’s savings account.

Whichever you choose, getting started early can teach your child valuable lessons in ownership and responsibility while also giving them a head start financially.

A savings account is perfect for teaching children how to save, a skill that will come in handy down the line as an adult.

Plus, a savings account also offers higher interest rate returns on their money, and savings accounts often have lower fees than checking.

What Makes a Good Kids’ Savings Account?

The best kid savings accounts have a few features in common, including strong savings rates.

Bank accounts typically require an adult to apply, so a standard account in a parent or guardian’s name.

So let’s turn to some of the best savings accounts for kids. When we compiled this list, we considered several factors:

1. Interest Rate: A high-interest savings account can help a child understand the importance of finding the best deals. While the interest rate isn’t the only consideration, it’s obviously an important one.

2. Low Fees: With many bank accounts for kids, the amount of money saved will be relatively small, at least to start. The last thing you want is fees eating away at the balance.

3. Low Minimum Balance: Some banks either require a substantial minimum balance or charge extra fees if a certain balance is not maintained. Unless your child’s bank account exceeds these minimums, it’s best to avoid these accounts.

4. Fun: Yes, a bank account can be fun. And particularly for young children, the fun factor can go a long way in teaching kids about money.

When Should I Get a Kids Bank Account?

Open a kids’ bank account once your child has a baseline understanding of the concept of money.

This age may vary from child to child, but by 6 years old or so, most children have a basic understanding of money.

By 9 years old, your child should be mature enough to set small financial goals. You’ll want your child to be invested in the idea of having a savings account that’s theirs.

Take them to the bank with you and set up a mobile app on their phone (if they have one) so they can check their balance and their progress.

In summary, you are now well-informed about the best options for savings accounts to consider when opting for a bank for your kids.

It is important to utilize at least one of the above-listed savings accounts mainly to teach your kids financial prudence.

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