Savings Accounts for Children

Children's savings accounts usually have no minimum age limit and can be managed by parents or legal guardians until the child is 18. There are various saving account options available, each with their own potential advantages and disadvantages. Instant access accounts allow greater flexibility for withdrawing funds (see Instant Access Accounts), whereas long-term savings accounts require that investments remain in the account for a defined period and do not usually allow withdrawals, in exchange for higher interest rates (see Notice Accounts).

Often regular savings accounts will offer generous rates of interest, but have many restrictions on the amount, if any, that can be withdrawn (see Regular Savings Accounts). It is also worth remembering that tax will automatically be charged on any interest paid on savings. As each child has his or her own tax-free income allowance, there is a form which can be filled out to ensure that the account receives gross interest payments, when the child's income is less than that of the maximum tax-free allowance.

Child Trust Funds are also available. These allow parents to save up to a certain amount tax-free, but these funds cannot be accessed until the child reaches the age of 18; see Child Trust Fund (CTF).