In the UK, children’s savings account are common. My kids have two of them there with different banks. Both came with special features designed to encourage them to save — a little plastic bank to sort their coins, for example, or a bonus on their interest. But here in the US, banks are apparently uninterested in kids. It’s been a surprisingly disappointing experience trying to find similar accounts.
Our local big bank offers kids savings accounts, but there’s nothing special about them. No special interest rate. No waiving of minimum balances. Nada.
Our credit union has youth bank accounts, but it’s pretty much the same thing. There’s no compelling reason to enroll the kids, so that they can gain 0.10%.
Looking around online, the pickings were pretty slim. Many credit unions seem to have kids saving accounts, but no everyone is eligible to join different credit unions.
Key Bank has a bank account for kids, no minimum balance required, which looked interesting. But with no branches near us, the kids don’t get the feeling of going into a branch to deposit their money.
That got me thinking. While I remember being a kid, having a paper passbook and going into a branch to make deposits, I rarely do that these days. My deposits are usually through an ATM or electronic transfers. So am I chasing an “old fashioned” account for my children that doesn’t fit the reality of banking today?
Perhaps. So how about letting go of needing a branch near me? There are a few more options. US Bank has youth savings account, as does Sovereign Bank. But US Bank only lets you use its own ATMs, while Sovereign provides no ATM access.
The perfect account seemed offered by USAA. No monthly maintenance fees. A decent interest rate (at least as decent as they get right now). Access through any ATM, and if there’s a fee, they’ll refund it. How sweet is that?
It did seem ideal, except for being only open to those with US military ties. Or so I thought. Thanks to Twitter, Michelle Lowery told me that wasn’t so. And I looked again. Buried, you’ll discover you CAN open a financial account without a military connection.
So if you do this for your kids, don’t worry that when you get through the application process, you’ll be asked all these military connection questions that you may answer no to.
Overall, I remain surprised there aren’t better offers out there for kids. I know my main credit card remains the one I got back because Citibank stuck a little table up and caught me on my college campus with a special offer. Kids accounts I guess are a pain for banks, but a little pain early on my produce better loyalty down the line.
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I still have my collection of NatWest pigs, they must be for a few bob these days.
We use this
http://www.tdbank.com/wowzone/wowzone.asp
I remember going to the bank, depositing money, and having them type a new line in my account book (black ink for a deposit and red ink for a withdrawal). I still enjoy saving but like you have not seen the inside of a bank — savings and loan or credit union — for months.
“Kids accounts I guess are a pain for banks, but a little pain early on may produce better loyalty down the line.”
Given recent events, I’m not sure banks understand the concept of deferred rewards.
My kids have regular savings accounts, but make deposits while they’re at school. That way they don’t have to go into the branch. The only hitch is that your school has to be participating. But it’s free and kids can have a savings account whereever they want. Check it out. schoolsavings.com.
I wouldn’t rave about UK bank accounts whether child or adult. For a long time people have been under the illusion that banks are our “friend” NOT SO.
BECU, the biggest Washington state credit union (and #2 nationally by deposits), has this supercool deal for kids and adults. First $500 in your first savings account gets 6% interest. It’s very smart. It means that everyone and his or her aunt and uncle sticks $500 in there and forgets about it, which with the number of accounts at BECU could be hundreds of millions of dollars.