How 7 banks fare on children's accounts

One of the best ways to teach children basic money management skills is to open up a bank account for them. A children's savings account is the perfect place to learn about budgeting and saving  while stashing their  allowance and birthday money.

Most Canadian banks offer no-fee accounts for children.  The accounts are pretty similar, with a few important differences.  Parents should be looking for these key features before opening a children's savings account; easy access, no fees, unlimited debit transactions, and a decent interest rate.

Here’s a look at some of the top children’s savings accounts in Canada:

The CIBC account stands out from the pack when you consider the key features mentioned above.  The ING children’s savings account does have the highest interest rate of the bunch, but the account is restricted to ING customers only.  The HSBC account is only available to children of premier clients who have personal deposits and investments over $100,000.  The Leo’s youth savers account from RBC leaves something to be desired, with an absurdly low 0.01 per cent interest rate and limited debit transactions.

Parents will need their child's Social Insurance Number (SIN) and one of the following documents in order to open a children’s savings account:

• Birth Certificate or;
• Passport or;
• Canadian Driver's License or;
• Canadian Citizenship.

Accounts can be opened online with the above information in as little as 10 minutes.  Alternatively, you can open the account over the phone in the same amount of time, or you can make an appointment at your local branch to open the account in person.

It’s worth noting that if the child is under 12 years of age, the account will need to be joint with a parent / guardian who is 18 years of age or older.

Young children are naturally curious and eager to learn new things.  Setting up a bank account for your children is a great way to get them to understand how money works, to see the benefits of saving towards a specific goal over time, and to get in the habit of saving money. 

Also Read:

Does your teenager need a credit card?

Easy ways to save for your child's education

Robb Engen is half of the Boomer & Echo personal finance blogging team with his mother, a former financial advisor.  You can reach him by email at robbengen@gmail.com