Kids’ Savings: Bank Accounts For Children

Kids' Savings Accounts

When it comes to kids bank accounts you need to decide what the aim is; do you want to teach your child to save or is the focus more on doing some serious saving? Although not without restrictions, there’s a host of good banking options for kids from the financial institutions – it’s a fun time to teach kids about savings, and there’s some serious interest to earn on the side. You can learn about the pitfalls of kid's savings and discover the banking options right here.

What Features To Look For In A Kids' Bank Account

Starting your children off early with banking can be a rewarding venture, since most banks are fiercely competing for new savers’ business – if a bank can grasp a saver young, they have a better chance of keeping a customer for life. Use this angle to your advantage and seek out the most competitive rate. In essence, you should be looking for:

  • No fees (Your child’s savings will probably begin small, so you definitely don't want fees)
  • The highest rate possible – it sounds obvious, but there are some really competitive rates available currently for kids and, just as a small savings fund suffers significantly from fees, it benefits equally significantly from a generous interest rate
  • Any access limitations – do you have constant free access to your funds or will you be charged if you withdraw?

The great benefit of a bank account for kids is that they can get the full experience, including walking up to the bank’s counter and depositing funds themselves, which can be a boost in both confidence and their understanding of finance.

High Interest Savings Accounts For Children

If you do want to teach your kids the art of saving but don’t want to compromise on savings return by allowing your children to manage their own savings, you could consider a standard high interest savings account. This option will depend on the age of your child, as commonly there is an age restriction for standard savings accounts. For example the UBank USaver account can only be opened by someone over the age of 18. BankWest’s TeleNet Saver, for example, can’t be issued to anyone under the age of 12. Generally, if a child is saving themselves they probably won’t have too much money to begin with, so fees should definitely be avoided. Luckily, you should find that most kids’ bank accounts don’t have fees. Having said that, most adult savings accounts don’t have fees either, making this a more viable option. Furthermore, a lot of kids’ bonus accounts have strict rules around depositing in order to qualify for high interest.

The Big Bank's Childrens Savings Accounts

(all the accounts below have no application fees and no ongoing fees)

Bankwest - Kids' Bonus Saver
Interest rate
Bankwest currently has the highest bonus interest rate available at 6%. This applies to the monthly balance of the account, if total deposits that month are between $25 - $250, and no withdrawals are made that month. Otherwise the base interest rate of 0.01% will apply.

Other conditions
Has to be linked to a Bankwest Children's savings account, total amount in Kids' Bonus Saver is swept across to this linked account every 12 months, which has a lower interest rate than the 6% bonus rate available on the Kids Bonus Saver. Available for children up to 15 yrs old.

Commonwealth Bank - Youthsaver
Interest rate
Bonus rate of 3.8% is added to the base rate of 0.01% if any deposits are made and no withdrawals in that month, no limits on deposit amounts, if these conditions are not met, the basic interest rate of 0.01% applies.

Other features for kids
Every child under 12 gets automatic membership to the Dollarmites club, which offers games, activities and tips to make saving fun. There is also an online playground, 'Coinland', designed especially for kids, with more games and downloadable content such as colouring in pictures.
The Commonwealth Bank also run the school banking program which is available in many schools throughout Australia. This encourages children to save, through offering options to deposit funds at school, and giving kids 'Dollarmite' tokens for deposits, which can be redeemed for prizes such as moneyboxes, wallets and more.The Youthsaver account is available for customers up to 18 years of age.

St.George - Incentive Saver
Interest rate
Bonus rate of 3.8% is added to the base rate of 0.05% if any deposits are made and no withdrawals in that month, no limits on deposit amounts, if these conditions are not met, the basic interest rate of 0.5% applies.

Other features for kids
Bi-Annual newsletter with activities and information sent out to members of the Happy Dragon kids club. There are no age limits on obtaining an Incentive Saver account.

NAB - Smart Junior Saver
Interest rate
Bonus rate of 2.8% is added to the base rate of 1.0% if any deposits are made and no withdrawals in that month, no limits on deposit amounts, if these conditions are not met, the basic interest rate of 1.0% applies. Available for customers up to 18 years of age.

ANZ - Progress Saver
Interest rate
Bonus rate of 4.4% is added to the base rate of 0.01% if any deposits over $10 are made and no withdrawals in that month, no limits on deposit amounts, if these conditions are not met, the basic interest rate of 0.1% applies. Available for customers up to 18 years of age.

Westpac - Kids Reward Saver
Interest rate
Bonus rate of 4.31% is added to the base rate of 0.01% if any deposits are made and no withdrawals in that month, no limits on deposit amounts, if these conditions are not met, the basic interest rate of 0.1% applies. Available for customers up to 12 years of age.

Other Banks Savings Accounts For Children

Suncorp - Kids Savings Account
Interest rate
Bonus rate of 2.5% is added to the base rate of 1.5% if any deposits over $20 are made and no more than 1 withdrawal is made in that month, no limits on deposit amounts, if these conditions are not met, the basic interest rate of 1.5% applies. Available for customers up to 18 years of age.

Other features for kids
Suncorp also has an interactive website designed for kids, which has games and downloadable content, plus an option for the child to donate to charity.

IMB - Zoo Account
Interest rate
Bonus rate of 3.0% is added to the base rate of between 0.10% - 0.75% (dependent on balance amount) if any deposits over $10 are made and no withdrawals in that month, no limits on deposit amounts, if these conditions are not met, the base interest rate applies. Available for customers up to 12 years of age.

Other features for kids
IMB gives a welcome pack to kids, which includes a free money box. They also give out a Zoo Rewards Card, which allows kids to collect cool stickers and enter competitions with the chance to win $100 each month.

Major lenders that don't offer a dedicated kids saving account
ING, RAMS, BOQ, Citibank.

Other options

All of the accounts mentioned offer a bonus interest rate, with conditions attached.If you’re worried about missing the regular deposits on bonus kids accounts (and therefore the high interest), it’s probably a wiser move to compare high interest savings accounts.

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