Many children over the last month or so have received gifts from grandparents and other members of their families and this is especially true as in December many are given cash Christmas presents. If a family member has sent them a cheque for their festive gift, it could be the ideal time to think about placing these in savings accounts for your children.
Finding the right type of savings account for a child may seem like a daunting task, after all there are so many to choose from. However, there is lot a of information available today which may make the job that much easier. Over recent times, with the credit crunch taking hold, many providers don’t offer very fair deals on children’s savings accounts. However, there are still a few around who do offer pretty fair deals on these accounts.
The first thing you need to decide is what type of account would be best for your and your children. There are children’s savings accounts that are designed for parents as well as relatives, who would like to build up a savings fund for children and these usually mean a person has to make regular monthly contributions to the savings account.
High street providers like the Halifax offer you the chance to open an account which allows you to save between £10 and £100 every month for a child. Their rate is 6% gross fixed for 12 months. However, you are not allowed to withdraw funds and you may not miss any payments into the account throughout the year.
Most parents should look to have some sort of instant access passbook account because this is a very good way of teaching children how to manage their money. This type of account, however does not offer the best of rates with an average of just 1.1% being the norm.
Best Deal Accounts May Have Age Restrictions
When you look into the best deals around you have to remember that some children’s savings accounts do have age restrictions attached to them and therefore may not be available to younger savers. The Chelsea Building Society Ready Steady Save account pays 2% gross and you are allowed to save from as little as £1 right up to £20,000. This account is an instant access account and does not penalise you for withdrawals. It is an account which has been specifically designed for children who are 15 and under, although a child under the age of 10 would need a parent to open the account on their behalf.
Another interesting savings provider that’s worth looking at is the Skipton Building Society as they have their Leap Account which pays 1.8% gross. The maximum you can save in this account is £6,000 up to the age of 18. It is a passbook account that has no penalties for withdrawals and not notice either. A parent would have to open this account on behalf of a child if they are under the age of 8.
Lastly the Yorkshire Building Society One Day account is another one that offers one of the best deals around at the moment. This accounts pays 1.74% and is available from birth to the age of 20. You only need £10 to open the account which makes it a very attractive option, another plus is that it has immediate access at any branch too. Again a parent would have to open this account for any child who is under the age of seven.