Believe it or not, your child doesn’t have to be ready to leave the house before they have their own savings account. In fact with many family and friends giving money as gift to parents, opening a savings account for your very little one can be great. Even if your child is older, there is still time to help them become financially savvy and building some savings.
What Are You Saving Up For?
With starting a saving account for your child(ren), one thing you may want to consider is what the money is being saved up for. As with many financial goals, how you save is often decided by what your plans are.
- General Savings: This can be a great place to stash all of the monetary gifts you receive from grandparents and loved ones for your little one. Finding a high interest savings account can help the account grow even faster.
- Car Fund: Whether you decide to help your baby boy or girl get a car is up to you, but having money saved up just in case you do is very handy.
- College: While a 529 College Savings Plan or a Coverdell Education Savings Account can be beneficial for your little one future education expenses, having some money saved for a small monthly fun budget can be a nice gift later.
As your little grows up, you can use their saving account to teach them about money.
Finding the Right Savings Account for Your Kid
If you’re looking for a bank to stash your little one’s cash, here are a few options that offer competitive interest rates and service.
Ally Bank – Competitive Rates
When it comes to saving money, Ally Bank has all the essentials for us:
- Covered by FDIC
- No monthly maintenance fee
- $0 required minimum balance
We having some savings over with Ally and so far the service and rates have been great.
You can open an account with Ally Bank here.
Capital 360 – Hassle Free Savings
One of our favorite banks is Capital One 360. We have used them for several years for our joint accounts and have found them easy to use. Like Ally, we use Capital One for savings because of the interest rates offered and the solid customer service. It’s also FDIC insured so your money is safe.
Having no monthly maintenance fee is important to us as we want out money to grow, not being hit with fees here and there. With having no minimum balance, you can open an account with small transfer from your account and contribute to it as much as your budget allows.
SmartyPig – Social Savings for Your Little One
First off, SmartyPig itself is not a bank, though its savings accounts are held at BBVA Compass which FDIC insured. when you set up an account you need a minimum of $25. If you want, you can elect to have an automatic transfer into your savings.
SmartyPig can be very handy with helping you save for a particular goal. The minimum amount for a savings goal is $250 and the maximum is $250,000. SmartyPig also gives you the ability to allow family and friends to add to your savings account through social sites, like Facebook and Twitter.
You can open an account with SmartyPig here.
Local Credit Unions and Banks
Online banking isn’t for everybody. You may find that having a brick and mortar location that you and your child can go to and visits is a better teaching tool. There are still banks and credit unions that are great partners with their communities that can help you. Ask family and friends which local banking option they recommend and try it out for yourself.
Thoughts on Opening a Savings Account for Your Kids
I’d love to hear from you about how your family saves. Where do you keep your little one’s savings and why?