Saving for your child’s future is one of the most important things you can do as a parent. Finding the best children’s savings accounts is a great way to kickstart your savings journey, whether for their education, a down payment on a house, or a rainy-day fund. These accounts offer a fantastic opportunity to teach your child about financial responsibility and help them develop strong saving habits from a young age.
Top Choice Savings Accounts
- HSBC MySavings – 5.00%
- Coventry BS Young Saver – 4.75%
- Principality Dylan Instant Saver – 4.20%
- Leeds BS Young Saver – 3.95%
- Newcastle BS Children’s Saver – 3.75%
What is a Children’s Savings Account?
A Children’s Savings Account is a specialised bank account designed to help young savers develop good financial habits from an early age. Typically opened by a parent or guardian, this account allows children to deposit money, earn interest, and learn the importance of managing their finances responsibly. Many banks offer these accounts with low minimum deposit requirements, no monthly fees, and competitive interest rates to encourage saving. A Children’s Savings Account provides a strong foundation for future economic well-being by teaching children the value of money and long-term financial planning.
How to teach your child to save
Opening a Children’s Savings Account is a significant first step, but teaching your child how to save is also essential. Here’s how to make saving money an engaging and valuable learning experience:
Set Savings Goals:
- Make it tangible: Help your child set a specific savings goal, like a new toy, a video game, or a trip to the zoo. Having a concrete objective makes saving more meaningful and motivating.
- Break down big goals: If your child wants something expensive, help them break the goal into smaller, more achievable targets. This prevents them from getting discouraged.
- Visual aids: Use a visual tracker, like a progress chart or a savings thermometer, to show how their savings progress towards their goal.
Make Saving Fun:
- Piggy banks: A classic for a reason! Let your child decorate their piggy bank to make it extra special.
- Savings jars: Use clear jars labelled for different goals (e.g., “Vacation,” “New Bike,” “College”). This allows your child to see their progress.
- Savings apps: Many kid-friendly apps make saving interactive and engaging with games and challenges.
- Reward systems: Offer small incentives or rewards when your child reaches certain savings milestones.
Talk About Money:
- Open communication: Have age-appropriate conversations about money, explaining why saving is essential for both short-term wants and long-term needs (like college or a car).
- Explain concepts: Introduce basic financial concepts like budgeting, spending wisely, and the power of compound interest.
- Answer their questions: Encourage your child to ask about money and provide clear, honest answers.
Set a Good Example:
Be a role model: Children learn by observing. Let your child see you saving money for your own goals.
- Involve them in your finances: When appropriate, involve your child in simple financial decisions, like grocery shopping or planning a family vacation.
- Share your experiences: Talk to your child about your experiences with saving and spending, including any mistakes you’ve made.
Give Allowance Wisely:
- Tie allowance to chores: This helps your child understand the connection between work and earning money.
- Encourage saving a portion: Help your child develop the habit of setting aside a portion of their allowance for savings.
- Avoid bailouts: If your child spends all their money, resist the urge constantly to bail them out. This allows them to learn from their mistakes.
By incorporating these strategies, you can help your child develop strong saving habits that will benefit them throughout their lives.
How to Choose the Best Savings Account for Children
- Interest Rates – Why higher rates matter for compounding growth.
- Accessibility – Can your child access their money, or do you manage it?
- Account Type – Regular savings vs Junior ISAs vs Fixed-term options.
- Parental Controls – Some accounts offer parental oversight and financial education tools.
- Tax Benefits – How Junior ISAs compare to standard children’s savings accounts.
- Regular or Lum Sum – what is best?
Best Children’s Savings Accounts
| Children’s Savings Accounts |
|---|
| HSBC MySavings Account – 5.00% – For 7 to 17 year olds – Min £10 – 5.00% interest up to £3,000 – From aged 11 child can manage account online |
| Coventry BS Young Saver – 4.75% – Min age is 7 to open an account – Open with £1 – Max £5,000 – Open in a branch only – Interest is paid monthly |
| Principality Dylan Instant Saver – 4.20% – 4.20% Gross* / AER† (Variable) – Min £1 to open – Must be under 16 years old – 1 withdrawal per calendar year |
| Leeds BS Young Saver – 3.95% – Min £10 to open an account – Interest is paid annually – Unlimited withdrawals – Open an account by post or in-branch – No online applications |
| Newcastle BS Children’s Saver – 3.75% – Open with: £1 and Invest up to £200 a month – Take money out: anytime – Variable rate of interest – Apply in branch |
Savings Interest Calculator
Want to know how much your savings could grow over time? Use our Savings Interest Calculator to estimate your potential returns based on your deposit amount, interest rate, and investment duration.
How It Works:
- Enter your initial deposit – This is the amount you plan to save.
- Select an interest rate – Choose the rate from one of the accounts listed above or enter your own.
- Choose your savings duration – Enter the number of months or years you plan to keep your money invested.
- See your results instantly! – The calculator will show you how much interest you’ll earn and your total balance at the end of the term.
- Get your results to your email – enter your name and email address and we’ll send you a copy of your results.
This tool makes it easy to compare different accounts and find the best option for growing your savings.
Frequently Asked Questions
Opening a savings account for your child offers several benefits:
Teaches financial responsibility: It introduces them to saving, managing money, and setting financial goals.
Develops good habits: Saving early encourages a lifelong habit of saving for future needs and wants.
Earns interest: Even small amounts can grow over time with the power of compound interest.
It funds their future. It helps you save for your child's education, first car, or other significant expenses.
Easy Access Accounts: Allow frequent deposits and withdrawals, offering flexibility but usually lower interest rates.
Regular Saver Accounts: Encourage regular saving habits with higher interest rates but often limit withdrawals.
Fixed-Term Accounts: Offer higher interest rates for a set period, but access to the funds is restricted during that time.
Junior ISAs (JISAs): Tax-efficient savings accounts with a yearly contribution limit. Funds can't be accessed until the child turns 18.
Interest rates: Compare rates from different providers to maximise your child's savings growth.
Access: Consider how much access your child needs to their funds.
Fees: Check for monthly fees, transaction charges, or withdrawal penalties.
Parental controls: Some accounts offer features like parental oversight or spending limits.
Tax benefits: JISAs offer tax-free growth, making them attractive for long-term savings.
This depends on your financial goals and circumstances. Some factors to consider include:
Purpose of savings: Are you saving for education, a car, a house deposit, or general future needs?
Time horizon: How long do you have to save?
Affordability: How much can you realistically contribute regularly?
Access varies depending on the account type and the child's age.
Easy access accounts: Usually allow withdrawals at any time.
Regular saver accounts: This may limit the number of withdrawals.
Fixed-term accounts: Restrict access until the maturity date.
JISAs: Funds are locked in until the child turns 18.
Children's savings accounts: Often converted to standard adult accounts.
JISAs: Become adult ISAs, retaining their tax-free benefits.
Yes, parents or guardians can usually open an account on behalf of a child.
Yes, most accounts are protected by the Financial Services Compensation Scheme (FSCS) up to a specific limit (currently £85,000 per person per institution).
Premium Bonds: Offer the chance to win tax-free prizes.
Children's pensions: Start a pension early to benefit from compound growth over the long term.
Investing: Consider investing in stocks and shares for potentially higher returns (but with greater risk).
Comparison websites: Compare interest rates and features from different providers.
Financial advice websites: Get expert guidance on children's savings.
Your bank or building society: Discuss your options with a financial advisor.
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