Types Of Bank Account For Children

childrens bank accountIn Today’s time parents like their children’s to indulge into banking so that it helps them in future and bank also support their decision to do so. Thus banks offer many options which help the parents to set up a bank account for children’s. Bank accounts for children can be set up for either long term perspective or even for short term needs. One of the bank account for children can be interest account where they can deposit their savings and sit back and watch their money grow by earning interest over time. There are also several bank account for children where they can open up checking account and it will allow them to manage and track their spending and funds. Here is some of the bank account for children where you can start banking of your children at smaller age only.

  • Education savings account

Education savings account is one of the options for opening bank account for children. They are established to pay off the education expenses of the children’s. These types of bank accounts are usually set for the individuals who are below the age of eighteen years. Grandparents, parents or any other interested individual might set up education savings account for the children if they find for any specific income requirement made by any of the financial institution. The funds put into education savings account might be used in covering up the secondary school expenditure or college fees or other educational expenses. Such kind of account can be set up with mutual fund or brokerage funds or banks and generally there are maximum annual contribution amount for each and every such account. Majority of the education savings accounts are non-deductible and also the withdrawals are also tax free for such accounts. This is one of the bank account for children which is advisable and even helpful to children.

  • Interest earning savings account

There are many banks which interest earning savings account which are designed specifically for children. This type of bank account for children allows the children’s to place their funds into the account and interest will compound every year. Parents or any interested adult can connect with the account of their children electronically and transfer funds into their account accordingly. There are some banks where bank account for children has to maintain minimum balance where as some banks does not have this criteria. By opening bank account for children, they can deposit their own money into it and this can also teach them the importance of savings from young age.

  • Joint checking account

There are several banks which allow opening bank account for children jointly with their parents. Such type of account is shared between children and parents jointly and both parents and children can have access to the bank account jointly and also manage their funds jointly. Banks have the right to establish limits and also have a check on their children’s spending habits and all.

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