The banks have designed accounts aimed at the youngest ones so that they start in the world of finance. These are accounts for children with gifts and special advantages for them, but they also include profitability so that their savings grow at their own pace. On this page we review all the features, advantages and limitations of a savings account for children.
What characterizes savings accounts for children?
A savings account for children works very similar to a traditional savings account, but with the particularity that they are aimed at clients from 0 to 17 years old (in some cases up to 14 years old). The purpose of these accounts is that they help young children to enter the world of personal finance, learn how banks work and manage their savings. However, for the bank they also have a clear objective, it allows them to attract potential customers and retain them, so that, as they grow, they will require more services managed by the same entity.
In general, savings accounts for children usually offer profitability , so that the money that is deposited inside will generate interest. Keep in mind that the profitability of these accounts is usually not very high, so that to attract customers, banks usually do so through gifts, discounts or promotions.
How do children’s accounts work?
The parents or legal guardians are in charge of managing the children’s accounts , since, obviously, a child of less than ten years could not understand the operation of these. Once they have grown up, children can take care of their own savings, but their parents will be able to continue supervising all the arrangements.
The parents or legal guardians are the ones who must request the opening of the children’s account on behalf of the children. For this, it will only be necessary to present the DNI. In addition, they will control the movements of the account until the holder reaches the age of majority.
Permitted operations with child savings accounts
The operations that are allowed with a child account are quite limited, since they are accounts conceived as savings accounts. The only movement that children can make, who are the account holders, is to enter cash. The rest of operations could not be carried out without the authorization of his tutor or the second account holder.
Advantages and limitations of accounts for children
They do not usually apply commissions.
As most are paid accounts, the savings will grow month by month.
Most offer gifts to attract new customers.
Transfers and transfers can be made.
- They can not be hired outside the age allowed by the bank, which is generally up to 17, although in some entities it is lower.
- Do not allow direct debits or other expenses.
How is the passage from a child account to a young account?
To ensure that the child remains in the entity as soon as he has reached the age of majority, banks usually change the child account for a young account. At that time, the range of possible transactions that can be made with the account is opened, since the young accounts allow direct debits, payroll or income or have debit or credit cards.
In addition, one of the advantages of these accounts is that they remain free of commissions. However, we recommend reading carefully the small print of the contract and understand what we are committed to.