Best Kids Savings Account [UK Banking for Children]

The best kids savings account offers a combination of growth, security, and parental control.

In this article, we’re discussing the different options available and how to choose the right one for you and your child.

This article is part of our free series on how to open a bank account, which covers bank accounts for all stages of life and all possible scenarios.

Feel free to use the table of contents to jump ahead to the sections most relevant to you.

Table of Contents

  1. Best Kids Savings Account
  2. What Are Savings Accounts for Kids?
  3. What Are the Benefits of Opening a Kids Savings Account?
  4. Which Bank Is Best for a Kids Savings Account in the UK?
  5. Frequently Asked Questions
  6. Ready to Explore Your Options?

Best Kids Savings Account

Finding the best kids savings account requires an assessment of the purpose of the savings, how often you plan to contribute, how much you plan to contribute, your desired rate of return, a number of tax considerations, and the flexibility you want the child to have in using the funds. With this in mind, the best kid’s account for one family will differ from the best account for another. 

Therefore, finding the best account requires parents to consider each of these variables, starting with the purpose of the savings accumulated for a child. This is particularly important if you plan on saving large sums of money for specific purposes such as university or college tuition, a down payment on a home, and more. The reason this matters is because most countries (such as the United Kingdom) have tax-sheltered accounts for these purposes.

What Are Savings Accounts for Kids?

Savings accounts for kids are designated accounts where parents can contribute and accumulate savings for their children before the child turns 18. This allows the child to start benefiting from compound interest, tax benefits, and even investments before they are able to legally open an account on their own.

What Are the Benefits of Opening Kids Savings Accounts?

The benefits of opening kids savings accounts extend beyond the financial and tax benefits that they afford. Additionally, and possibly more importantly, kids savings accounts can teach children important lessons about managing money, compound interest, and budgeting.

However, the financial benefits are very real as well, and can enable parents to accumulate significant savings for a child early in life. In doing so, parents can set their children up for long-term financial stability and independence.

Here’s a look at all of the different benefits that parents can expect when they open a kids savings account.

Benefits of Opening Kids Savings Accounts

  1. Learning how to regularly save
  2. Understanding the basics of budgeting
  3. Seeing the benefits of compound interest
  4. Accumulating savings for future financial commitments
  5. Providing a foundation for financial stability
  6. Protecting savings from taxes (in some cases)
  7. And more…

Which Bank Is Best for a Kids Savings Account in the UK?

The specific bank that is best for a kids savings account in the UK depends on the variables that parents are trying to optimize for. For example, if you are simply looking to get the highest interest rate possible, you will want to consider one of the high-street banks that offer interest above 3.75%.

Here is a look at the important considerations to think through when choosing the best bank for your kids.

How to Choose the Best Savings Accounts for Kids

  • Available interest rate
  • Type of account available
  • Savings & investment options
  • When you want them to have access
  • Support for tax efficiency
  • Availability of other services when older
  • Ability for the parents to manage
  • Applicable fees
  • Minimum deposits

Please note: If you are a foreign non-resident of the UK and you’re looking to open with UK banks for your children, this is possible. However, you will need to open an offshore bank account, which you can do 100% remotely.

Frequently Asked Questions

Below are three of the most common questions that we receive from people looking into opening the best kids savings account. If you have further questions you would like answered, don’t hesitate to get in touch with us directly.

Are Children’s Savings Accounts Safe?

Children’s savings accounts are as safe as any other bank account, which means their safety ultimately depends on the bank, credit union, or building society that you choose to open accounts with. That said, in most countries, these accounts will be backed by deposit insurance, which offers protection up to stated amounts.

How Is a Children Savings Account Opened?

A children’s savings account is opened like any regular savings account, with one difference being that the parent applies on the child’s behalf. With this in mind, the parent will need to provide all of the same account opening documents for themselves along with the proof of identification for their child.

Which Savings Accounts Are Best for a Child?

The savings accounts that are best for a child depend on many different variables. So, it is not possible to select a single savings account for all children, just like it is not possible to select a single savings account for all adults. With this in mind, parents should take an active role in deciding which bank accounts to open and which variables are most important to them.

Ready to Explore Your Options?

If you would like assistance navigating your banking options at home or abroad, we can help.

You can access GlobalBanks IQ, our international banking intelligence platform, in just a few clicks. Unlock our bank database, individual bank profiles, account opening strategies and reports, banker scripts, and more.

But, if you want a 100% personalized account opening service that taps into our team’s expertise and provides direct banker introductions, you can get started with GlobalBanks Insider.

Of course, if you have any questions, please contact us directly.

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