Wednesday, 22 January 2014

Child bank accounts - getting the best deal for you

We decided late on the pregnancy that we wanted to open a bank account for Baby M.  We wanted a way that we could save money for things like shoes, etc but also a way that we can save money for his future.  Who's to say whether he will go to university or not but it would be nice to have some money saved up incase he does.  Or to support him in whatever he decides to do with his future.

We decided to have a look around to see what kind of deals are out there.  We used Martin Lewis website at first to see what offers he suggests for child accounts.  We soon discovered that the offers and interest on children accounts were not that great.  Many had interest rates of 0.5% - which is nothing!

Following more research we discovered the Halifax Young savers account.  Whilst the Kid's regular saver account offered the best interest rate fixed at 6.00% you aren't allowed to withdraw any money from the account until you close it - great if you are saving for the future, not so great when we wanted to be able to access the money if Baby M needs anything. 

The Junior ISA was a variable interest rate but currently offered at 6.00% but again you could not make any withdrawals from the account until the child is 18 - again good to consider if you are saving for the future.

The Young Saver account offers interest rate of 3.00% on the first £20,000 then 0.5% after this.  You can also withdraw money unlimited times from the account - brilliant this was exactly what we were looking for.  The account can only be managed in branch, which is fine by us.  Baby M will get his own bank card when he is 7 years old.

There are a lot of different accounts out there and it is best to do your research to find the account that is best for you and what you need it for.

Disclaimer:  This post is not sponsored by Halifax, the views are my own.