Which bank account is best for your child?

One of the best ways to teach children about the importance of money is by opening a bank account for them. This way they will learn about saving and daily management of money. 

JustMoney contacted the most prominent banks to compare kids’ bank accounts, to help you decide which one might be suitable for your child.

Tip: Start to compare accounts from different banks today

What does having a bank account accomplish?

In a tech savvy and highly digitised world, opening a bank account for your child teaches them about the importance of managing their money in a safe and secure place, setting up saving goals, and making their money go further by earning interest.

The benefits of opening a bank account for children are vast and there is no one-size-fits-all answer says Cowyk Fox, managing executive of everyday banking at Absa. 

In short, transactional accounts would typically allow accountholders to “manage” money, while saving accounts help people understand the power of savings, he says.

Involving children in banking decisions is a great way for them to learn about the importance of managing finances, Fox points out, and to help them develop a healthy relationship with money. 

A bank account comparison

Below is the list of kids’ bank accounts from South Africa’s biggest banks and their benefits:

Things you should consider when opening a bank account for your child: 

As a parent or guardian, it is natural to lean towards the bank that offers the most for the lowest price. However, Yashen Singh, CEO of premium core banking at FNB says you must consider the following when opening a bank account for your child:

• The controls that are in place for you, as parents or guardians, to have oversight of the account whilst your child is under 18.
• Ease of service and channels available (app, online banking, branch etc) for both you, the parent or guardian, and the child.
• The options that the bank offers the child beyond 18 (e.g. what are their student or graduate and professionals offerings?).
• The options the bank offers to the family as a whole (i.e. ease of transacting between parent or guardian and the child’s account, benefits to parents for opening an account for a child etc).
• The offerings/tools available to the parent or guardian and child over and above the transactional account that would be required throughout the child’s various life stages, for example educational savings, student loans, vehicle finance, unit trusts etc.
• Also consider where you bank so you can seamlessly help manage your children’s accounts, and even do inter-account transfers when needed.

Children learn by doing, so the only way to kickstart their journey to forming great money management habits when they are older is to equip them with the tools to do so.

To hear some thoughts from children about money and saving, watch this video.

Go to our articles to learn about good money management