How to open a savings account for kids (plus tips)

Happy parents and their two children (ages between 5 and 13 years old) open a savings account for kids online together on a laptop.
June 29, 2023 | Lois Sullivan

You might want to open a savings account in your child's name for many reasons, including helping them learn important financial lessons from an early age. Opening a savings account for a child also teaches children the value of money and how to save for what they want. Through a savings account, children can learn to log in to their accounts, track earnings and budget for things they want to buy. To open a savings account for your child, follow these steps.

Choose a credit union or bank

When you're ready to open a kids savings account, you'll find many available options. Research your options to find the best savings account for you and your family. A few key questions to keep in mind include: 

  • Is there a minimum deposit requirement?
  • Is there a monthly fee?
  • Does the credit union or bank have a mobile app and online banking?
  • Is the bank insured by the FDIC (Federal Deposit Insurance Corporation)? Is the credit union insured by the NCUA (National Credit Union Administration)?
  • What interest rate does the financial institution offer on savings?

Some credit unions or banks have minimum initial deposits or daily balances, which are essential to evaluate to avoid unexpected costs or penalties. The great thing about kids savings accounts is many credit unions or banks offer them to children of a certain age with no minimum withdrawals or monthly fees.

Some credit unions or banks also offer financial education tools for kids and teens. These resources can help children develop financial literacy in a fun, engaging way.

Collect documents

When you open a savings account for a child, you'll need a few more documents than if you were to open your own account. Depending on the financial institution, the documents you need might vary. To be safe, make sure you have easy access to your child's birth certificate, Social Security card, driver's license (if applicable) and passport. The credit union or bank will also need information on the parent, including a valid U.S. government-issued ID (driver's license, passport, state or military ID) and Social Security number.

Involve your child, at any age

Opening a savings account as early as possible is a great way to tailor financial lessons to the child's age. With an online kids savings account, you can easily involve your child in each step, including creating a login and opening the account. Setting up online logins together makes tracking savings, deposits and withdrawals easier. Some online banks also have mobile apps, which can be especially useful for tech-savvy teenagers and pre-teens.

Make an initial deposit

Many credit unions or banks require you to make an initial deposit when opening a savings account. A great time to start an account is when your child is born so that you can store any money they’ve received from family or friends. However, you can start your child’s account at any time by making the deposit from your own account on behalf of your child, or start it with money they've received as a gift from a specific event or brithday.  

This is also a good time to link any other necessary accounts. For example, some parents might want to link their checking account with a child's account to transfer funds for birthdays, allowances or chores.

Discuss financial goals

Once you've set up and funded your kid's savings account, it's time to discuss financial goals. Use this as a learning opportunity for your child by discussing the importance of savings, including both short- and long-term goals. After your child creates a few savings goals, encourage them to think of ways to continue funding the account. For example, they might request additional chores around the house to grow their savings faster.

Help your child break down their larger, long-term savings goals into a realistic timeline. This can help them develop budgeting and planning skills. Some families might offer incentives to encourage savings, such as matching deposits up to a certain amount. Some online accounts or mobile apps even allow you to create savings goals within the program, allowing your child to transfer money and track progress toward their financial goals. 

Get in the habit of monitoring accounts

Encouraging your children to log in to their savings account regularly can help them develop good financial skills. They can then track their savings and progress toward goals. Paying kids for chores digitally encourages them to log in and track their funds. They can also learn to track their account balance to avoid spending more than they currently have in their account.

Adjust lessons and goals

When you open a savings account for kids, you create an excellent opportunity for them to learn valuable financial lessons. As kids get older, however, you can adjust the financial lessons and goals they learn. For example, encourage older children to reconcile their accounts or track spending over a specific period.  

Once your child turns 13, you can help them can open a teen checking account that includes a traditional savings account. A debit card is an excellent way to expand financial literacy for older children who have already demonstrated responsibility. Teenagers might create larger financial goals, such as saving for their first apartment or car. Helping them manage their money and find ways to continue funding their savings account is a great age-appropriate lesson.

College-age kids can also benefit from a savings account to help manage college expenses and pay tuition. By that point, they'll have had many years of financial planning and budgeting experience, preparing them for a future of good habits.

Try a credit union

Credit unions are owned by their members, not by stockholders, and are financial institutions that prioritize their members’ needs.  When you open a savings account for your child at a credit union, your child becomes a member-owner at the credit union. At Alliant, we offer kids savings accounts, value financial literacy and believe it's never too early to start learning.

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