Kids' bank accounts

Changes to tax rules mean little savers can be hit with a big tax bill.
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Our review of 10 savings accounts, designed for children and teenagers, assesses the interest rates, fees, number of withdrawals allowed per month, and age limits.

In this article:

Opening a bank account for your child is a great way to introduce them to the concept of saving and what banking is all about. 

You’d think banks would make children’s accounts as simple as possible, but having checked a number of them, CHOICE has found out some very confusing conditions.

Government generosity is also limited. Since 1 July 2011, the low-income tax offset no longer applies to interest earned by children. This means taxes apply if they earn more than $416 in interest, to discourage parents from putting money into accounts under their child’s name. 

Most kids’ accounts from banks we looked at offer reasonable interest rates, but we found some low rates when looking at some credit union kids’ accounts. 

It’s worth noting that regular savings accounts can also be relevant for children’s savings. Online savings accounts are a good alternative for teens. ANZ Smarty Pig is available for kids aged 12 years and older, and ING Savings Maximiser for kids aged 13 and older. Check out High-interest savings accounts.

For more information about saving money, see Banking.

Let’s go to school

CBA’s School Banking Program, in which kids can deposit money weekly at their school, has been running for 80 years and has more than 3100 primary schools participating. 

Its Rewards Program is based on the number of deposits rather than the amount deposited. The schools receive a commission of $5 per account activated plus five per cent of the money deposited.

Tip: The CBA Youth Saver offers less interest than other kids’ accounts, but by letting your child participate if their primary school offers the School Banking Program, you can encourage them to save in an easy-to-understand way.




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