If you’re a parent, financial literacy is one of the most important skills you can teach your kids at an early age. Opening a savings account for your children can give them a head start on aspects of personal finance and make concepts such as savings, budget, and financial goals become more real, practical, and exciting to them.
Prior to taking the leap, it is important to decide on what your goals and plans for your children’s savings account will be. Putting in mind these priorities will help you choose the right account option. Here are a few things to know before opening a savings account for your children.
Key Considerations when opening a children’s account
What do you want to achieve with a child’s savings account?
What’s the motivation behind opening a Kiddies’ account? Do you want to teach your children to save or do you want to save towards their university education or other future goals?
Here are a few things opening a bank account for kids or a child’s savings account can do for your kids.
- Provides them a glimpse of how banks work
- They learn to keep their money in the bank
- Grow their money in a savings account
- Provide a way of saving for their future.
Trust fund or Kiddies Account
A trust fund is a legal entity that is established to hold assets for a specific people until a particular time. A Kiddies Account, on the other hand, can yield more interests that can help to grow the money over time.
Interest rates for Royal Kiddies Account – WEMA Children’s Savings account
Wema Bank has an interest rate twice that of some other banks. Boasting 2.15 percent in interest. For a Firstbank account, you need a minimum of 10,000 as opening balance, Access Bank and Polaris Bank have a minimum opening balance of 1000. Both Zenith Bank and GTB have a 1.15 percent interest rate.
An additional thing to consider when choosing a bank account for your kid is that, is my child old enough to own a children account or Kiddies Account?
Savings Account by Wema
The different types of Savings Accounts for children have some basic features. You and your child will be joint owners of the account with the account being opened in your child’s name. Your child has access to funds in the account and you are privy to the transactions that occur through the account. Children accounts have fairly high-interest rates. For example, WEMA bank gives a 2.15% interest per annum on their Royal Kiddies Account. Children accounts also sometimes come with a set of unique features such as mobile or online banking tools such as an e-purse.
Children’s Savings accounts are relatively simple to open and handle. With bank requirements like minimum balance and transaction fees kept to the barest minimum, you can focus the running of your kid’s savings accounts on a number of goals, the most important of them is teaching your child about money and finance. Owning a savings account can educate your child on different financial channels, the importance of and discipline required to save, savings goals, etc. It can also help them garner banking experience, for example; learning how to use a banking app, issuing or depositing a cheque, and many more. Your child’s savings account can also be beneficial to you. You can employ it as a short to medium-term savings vehicle for major expenses related to your kids such as school fees, medical fees, etc. Likewise, you’d earn higher than normal interest rates on money deposited in the account over a period of time.
What documents are required for opening a Children’s Savings Account?
You’d mainly need your child’s Birth Certificate, School photo ID, a photo of your kid and yourself, a copy of the utility bill, and a valid ID for yourself.
The WEMA Royal Kiddies Account is an easy to set up children’s savings account, designed to give children an early start to financial freedom. Click here to find out more about WEMA Bank Royal Kiddies Account.
What Bank would you recommend for a Kiddies Account?