How to open a savings account for children?

Educating the children about saving money is an important aspect. The process can be initiated by having a simple piggy bank and you can teach the children how the banks function and what are the benefits provided by them. Opening a savings account for children will teach them the valuable skill of transacting with banks, recording the transactions, calculation of interest, writing a deposit or withdrawal slip and much more. However, the account will be controlled by parents. Following are simple steps involved in opening a savings account for children.

Determine the type of savings account you want to open. It may be either a simple checking account or a typical savings account offered with nominal interest rate. A simple checking account may be opened by a minor without the assistance of an adult. But other types of savings account for children require the authorisation and supervision of an adult. Some banks do not insist on maintaining a minimum balance requirement as an additional facility offered exclusively for saving accounts for children. But few banks offer the savings accounts for children with higher rate of interest for maintaining a fixed amount of balance and regular deposits in the account.

Check the state laws followed by the banks. Some of the states allow the children to have their bank account without the supervision of the adult. Most of the banks require the custodian to authorise and operate the bank account on behalf of the child.  But these rules may vary according to the banks.

Select an appropriate bank you want to deal with. The bank located at a convenient place, terms and conditions, minimum balance requirements, services and facilities offered, monthly service charges and fee, rate of interest offered on savings accounts, etc should be examined before selecting the bank. Several banks offer online access and ATM cards.

Once you have decided the bank, collect the necessary documents to be submitted with the application for opening savings account for children. And the application should be supported by the following documents.

• Citizenship proof, Identification proof and address proof of the custodian i.e. parent or authorised guardian – Driving license and a valid passport.
• Name and address of the child
• Birth certificate of the child
• Relationship proof
• Social security of number of the custodian as well as the child

After collection of appropriate documentary evidences, visit the bank and meet the appropriate officer or the representative. Ask the authorised person to explain about the procedures and other benefits that can be availed in having a savings account for children. On understanding the terms in a clear manner, you can submit the application with the other necessary documents. After the same is being processed by the banks, you will be furnished with the account details and documents. Ensure that you have received all documents supporting the new account like account details, ATM card offered if any, online banking details, facilities offered on children account etc. Read and understand the documents and if you find anything is not clear or improper, notify the bank as soon as possible.