Opening a bank account in your child’s name is a good idea on many fronts. It can provide an easy way to save towards university expenses, offer bonus interest and help to teach your child about saving early in life. However, not all bank account for babies are the same, so it pays to shop around.
Compare youth savings accounts*
*The information on this page is not intended to be an endorsement or recommendation of any product and is not a representation of all the products available on the market. We’ve chosen to highlight certain products based on a range of factors, which may include commercial partnerships and details such as features, fees, rates, options, flexibility and customer support. There is no single, perfect financial product for everyone, so we encourage you to make your own decisions and assess products based on your individual needs, preferences and circumstances.
*Rates and account information are current as of May 7, 2019
What is a bank account for a baby?
Some banks and credit unions provide accounts especially for children. You can open an account in your baby’s name, provided you and your baby meet some basic eligibility criteria.
A typical baby account provides interest and won’t charge ongoing fees. However, they may come with some depository requirements along with restrictions on withdrawals.
How do I open a bank account for a newborn?
You’ll need to list both your name and the child’s name on the account, but some accounts will let you sign full ownership of the account over when the child is legally an adult — 18 or 19 in most provinces and territories. You can open an account online or at a bank branch, and you’ll need to provide personal information for yourself and the baby. This can include social insurance numbers (SIN), an address and phone number and a photo ID or birth certificate. Your email address and proof of residency may also be required.
Can I open an account before my child is born?
No. You’ll need to provide a social insurance number (SIN) and/or birth certificate, which means you can’t open an account for an unborn baby. But some banks will let you open an account in your name and add the baby after he or she is born.
How do I choose the best baby bank account?
When choosing a new account, compare:
Requirements for opening the account. This includes minimum deposit amounts and any necessary information, like a social insurance number (SIN) or birth certificate.
Ongoing fees. Some accounts will charge ongoing monthly or yearly fees, though you may be able to waive them by meeting depository requirements or maintaining a minimum monthly balance.
The interest rate. Look at both the interest rate and how often it compounds. While credit unions and online banks tend to offer better interest rates than mainstream banks, that’s not always the case.
Location of branches. It’s important to note how close a branch is to your residence when opening a bank account for a child. While online banking might be perfect for adults, banks give children limited access to these platforms. As your child grows older, it may become important o be able to visit a branch to make deposits and withdrawals.
Account type. Some accounts will let your child withdraw money as he or she grows up, while others won’t allow withdrawals until the child reaches adulthood.
What types of accounts are available?
Bank account options for minors include:
Savings accounts. With a traditional savings account, the minor will be able to add and withdraw funds before they’re 18. This can be a great way to teach kids to save up for special purchases.
GICs.Guaranteed Investment Certificates can be gifted to a child if you list yourself as the account custodian. They tend to earn higher interest rates than savings accounts, and the guaranteed rate means you’ll know exactly how much your gift will be worth when it matures. Your child will need to wait until they’re the age of majority before they can access the funds. Note that you will have to report income earned from investments like GICs on your tax return.
RESPs. Registered Education Savings Plans let you set aside money to be invested for your child’s future education (see the Government of Canada’s website for more information). The government matches your contributions up to a yearly maximum. A lifetime total of up to $50,000 can be saved per beneficiary before you begin being taxed on your contributions. When your child is ready to go to school, he or she can make withdrawals from the RESP. However if your child decides not to go to school, the money can be transferred to another child or withdrawn. If it’s withdrawn, the money will be heavily taxed. There are 3 different types of RESPs to choose from:
Family plan. This plan lets you name more than one child to the account, if you want to. The benefit of doing this is that it allows children to share savings among themselves when it comes time to go to school. Family plans can be set up for beneficiaries who are your children, stepchildren, grandchildren, brothers or sisters. Beneficiaries can be related by both blood and adoption.
Individual (non-family) plan. This account lets you save for just one person, and this person does not have to be related to you. You can open an individual RESP for a child, yourself or for another adult.
Group plan. In a group plan, your savings are combined with the savings of other people who are setting aside for other beneficiaries. You can only name one child to the account, and withdrawals are made based on the total amount in the account. The specific amount that each child gets is based on how many children/beneficiaries of the same age who are in school during the same year.
Are there any government regulations or taxes?
Children can be required to pay income tax. If your child’s income from all sources (such as investments and any form of employment) is above the income thresholds set by the federal and provincial governments each year, then he or she will owe income tax to the CRA. But if your child’s income falls below this threshold, he or she won’t owe any income tax.
Starting a savings account early lets your money grow as your child grows. Whether you want to open a savings account, GIC or RESP depends on your savings goals and the amount of access you want the child to have. No matter which option you choose, compare financial institutions to make sure you’re getting the account that will offer the most growth.
Want to learn more about savings accounts including which features you should look for, what fees to expect and where to find the best account for you? Check out our detailed guide to savings accounts.
Frequently asked questions
Yes, you can open an account for a child who isn’t your son or daughter. You’ll still need to provide identifying details, so you’ll need to let their parents know.
Banks usually have account options for children. TD Canada Trust allows any resident of Canada who is at least 12 years old open an account, while BMO allows children to own accounts at any age.
Most banks require chequing account owners to be at least the age of majority in the province or territory in which they live, so children cannot open accounts by themselves. Children are not legally allowed to enter into binding contracts, so an adult must be present with ID to open an account.
Shirley Liu is Finder's global program manager. She was previously the publisher for banking and investments and has also written comparisons for energy, money transfers, Uber Eats and many other topics. Shirley has a Master of Commerce and a Bachelor of Media, Journalism and Communications from the University of New South Wales. She is passionate about helping people find the best deal for their needs.
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Tangerine Children’s Savings Account
CIBC Advantage for Youth
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BMO Premium Rate Savings Account
EQ Bank Savings Plus Account
