The Best Savings Accounts for Kids and Teens: Start Saving What You Earn!
As kids and teens dive into entrepreneurial adventures, from lemonade stands to online businesses, they often find themselves earning more than just pocket change. But what’s next for that money? Rather than spending it right away, opening a savings account can be a smart step towards managing and growing those hard-earned dollars. This guide covers the top savings accounts specifically designed for young savers, helping them learn the importance of saving early.
- Why is Saving Important for Young Entrepreneurs?
Saving is key for kids and teens to learn financial responsibility and prepare for future goals. Kids love to ask for something. But instead of just giving it to them, use this as an opportunity to teach them have to SAVE for what they want instead. This practice creates good habits earlier in life and can have an impact on their long-term financial health.
- Key Features to Look for in a Kid-Friendly Savings Account
- Low or No Minimum Balance: For young savers just starting out, high minimum balances can be a barrier.
- Parental Controls & Co-Management: Accounts that allow parents to help monitor funds while giving kids independence.
- Interest Rates: The higher the rate, the better the returns, so choosing accounts with favorable rates is key.
- Educational Tools and Resources: Some accounts offer educational content or features that teach financial literacy.
3. Top Savings Accounts for Kids and Teens
Here’s a list of top-rated options that make saving easy, accessible, and even a little bit fun.
Capital One Kids Savings Account
- Features: No fees, no minimums, and an interactive interface that makes saving fun.
- Best for: Younger kids and parents who want to help manage funds while teaching financial basics.
Ally Bank Youth Savings Account
- Features: No monthly fees, competitive interest rates, and mobile-friendly with parental controls.
- Best for: Teens who are interested in using digital tools to manage their money and track their savings growth.
Chase First Banking Account
- Features: Tied with a checking account that includes budgeting tools, no monthly fees, and spending limits set by parents.
- Best for: Kids with an entrepreneurial spirit who are also learning budgeting and money management.
Alliant Credit Union Kids Savings Account
- Features: High-interest rates, no monthly fees, and a $5 minimum to open.
- Best for: Young savers with a focus on maximizing their earnings, as the account offers higher-than-average interest rates.
Bank of America Minor Savings Account
- Features: Access to physical branches, $25 minimum deposit, no monthly fees if minimum balance is met.
- Best for: Kids and teens who may need access to a branch or prefer a traditional banking experience.
4. How to Open a Savings Account as a Teen or Kid
- Outline the general steps to open an account, including the role of a parent or guardian, necessary identification, and any deposit requirements.
- Discuss the importance of understanding account terms, including fees and minimum balances.
5. Tips for Kids and Teens to Maximize Their Savings
- Set Savings Goals: Having a specific goal (like a bike, tech gadget, or saving for college) can motivate consistent savings.
- Automate Deposits: For teens with regular income from a business or job, consider auto-transfers into the savings account.
- Track Progress: Encourage young savers to check their balance regularly and see how their money grows over time, especially if they have an interest-bearing account.
Start Saving Today!
Saving isn’t just about putting money aside—it’s about learning responsibility, independence, and the value of financial planning. By opening a savings account early, kids and teens are setting themselves up for a financially strong future. So, whether you’re making money from babysitting, mowing lawns, or even a small business, saving a portion of those earnings can be one of the best steps you take!
Check out this episode of the Cash Kid Podcast where we talk with a banking expert about the difference between a checking and savings account: https://www.cashkidpodcast.com/podcast/checking-vs-savings
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