Best Savings Accounts for Kids for 2026

Methodology: How we choose the best accounts

Our banking experts research over 120 kids’ savings accounts to curate a list of the best accounts for you to choose the right one for your child. We look for accounts that have low to no monthly fees and don’t require much money to open. We also consider whether the account requires a membership or opening the account online or in person.

Accounts that cater to kids across the US also get high marks in our analysis as well as those with extra tools for setting goals, investing and more. Last, we love accounts that make financial learning fun for kids through avatars, games and a kid-friendly design.

8 kids’ savings account alternatives

Since minors can’t legally sign contracts, they won’t be able to open a savings account under their own name. This leaves seven options that require an adult:

• Joint savings accounts. You can open a regular savings account jointly with a minor. Some banks may prevent children under the age of 13 from making withdrawals without the co-owner’s signature, but others may give you equal access to the account.
• Prepaid cards for kids. Also known as kids debit cards, these accounts come with a mobile app and prepaid card that let you assign and track chores, control your child’s spending, and give them a safe space to learn how to save, spend, give and invest.
• Uniform Transfers to Minors Act (UTMA). A UTMA account is a type of custodial savings account that is owned by the minor but managed by the custodian. This allows the custodian to make irrevocable deposits of nearly any type of asset into the account.
• Uniform Gift to Minors Act (UGMA). A UGMA account is another type of custodial account that is very similar to a UTMA account but only allows custodians to make deposits in the form of bank deposits, stocks, bonds, mutual funds, other securities and insurance policies.
• Education savings accounts (ESAs). Education savings accounts allow you to start saving for your child’s K-12 or college education. These investment accounts are tax-free as long as you use funds on qualified education expenses.
• 529 plans. These prepaid tuition plans and education savings plans, which are sponsored by states, state agencies and educational institutions, let you set aside funds for your kid’s higher education.
• High-yield savings accounts. Open a high-yield savings account in your name to earn a better APY than kids’ savings accounts typically offer, but there may be tax implications to contend with.
• Certificates of deposit (CDs). Some CDs earn better rates than savings accounts and can be gifted to a child, but your kid will have to wait until they reach adulthood before they can access the funds.

Compare debit cards and savings accounts for kids

Use the table to compare kids savings accounts and debit cards. If you spot multiple accounts, select the “Compare” box to explore them further.

How to set up a custodial savings account for kids

Adults can set up custodial for or joint savings accounts with their child or grandchild, often finding a higher interest rate than with kid-specific savings accounts. To get started:

1. Call the bank or visit in person. Banks don’t usually advertise which accounts you can open as a custodial or joint account with a minor. Ask a rep about your preferred account to know for sure.
2. Provide personal information. To open the account, you’ll need name, birthdate and Social Security numbers for both you and your child as well as your government-issued ID. Give the rep all of this information, or provide it online if you’re able to use an online application.
3. Fund your child’s account. You’ll usually provide the account and routing numbers for your checking account along with the dollar amount you’re transferring.
4. Download the app. You and your child can download the bank’s app to log in and view your child’s balance. Or you might choose to show young kids their balance from your app.

Tax implications of children’s savings accounts

Children’s savings accounts are a great way to teach kids about the importance of saving and can help them work toward short- and long-term financial goals. While there are a number of ways you can make deposits, children’s savings accounts are not a way to avoid paying taxes. Tax rates and rules can differ between states, banks and accounts, so check with your institution to ensure you’re wholly informed.

Kiddie tax

The kiddie tax is designed to discourage parents from shifting investments to their children to avoid paying taxes. It applies to all children under the age of 18 or students under the age of 23 whose unearned income — including interest, investments and gifts — exceeds $2,100. The first $1,050 is tax-free, whereas the second $1,050 will be taxed at the child’s rate of just 10%. Any amount of unearned income above $2,100 will be taxed at the same rate as income in a trust.

Gift tax

Individuals can gift up to $15,000 per year — or $30,000 for married couples — without gift tax implications. For amounts above this limit, a gift tax return must be filed. However, every individual has a lifetime estate and gift tax exemption amount of $5.6 million — or $11.2 million for married couples. This means that even if you exceed the annual gift limit, you may not owe any taxes.

Tax bracket

Because children generally fall into a lower tax bracket than their parents, opening a custodial account in your child’s name will reduce the percentage of your savings that goes to Uncle Sam.

Requirements for popular kids’ savings accounts

Each bank sets its own rules and requirements when it comes to savings accounts for kids. This table breaks down the age limits, eligibility requirements and more for popular kids’ savings accounts, so you can know what to expect.

4 benefits of kids’ savings accounts

All reputable savings accounts for kids are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000, so you’ll never have to worry about your child losing money. Kids’ savings accounts also have these benefits.

1. Sets kids up for financial success. Studies show that opening a savings account for your child can lead to financial success later in life. Children with savings accounts are also more likely to invest in stocks as adults.
2. Usually no fees. The best savings accounts for kids are typically free to open and maintain, but some fees may still apply. Read the fine print and watch out for minimum balance requirements, monthly statement fees and other charges.
3. Low age requirements. Unlike checking accounts for kids, which typically require children to be at least 13 years old, savings accounts are open to all ages. You can even open a savings account for your baby as soon as you receive their Social Security number, giving you more time to take advantage of compound interest.

5 things to watch out for

Keep these drawbacks in mind when deciding whether a kids’ savings account is right for you.

1. The taxes could be quite high. Children’s savings accounts are still subject to taxes, especially if the amount exceeds the kiddie tax threshold.
2. APYs aren’t high. While children’s savings accounts usually are interest-bearing, they may not earn as high an APY as high-yield accounts for adults.
3. Limited ATM access. Although some savings accounts for kids, such as Regions Savings for Minors, come with ATM cards, most do not.
4. Account transfer. Some banks will automatically convert the account to a student or teen checking account, while others may require you to transfer the funds to a new account yourself.
5. Transaction access. Some accounts allow your kids to deposit or withdraw funds of their own volition, while others require a parent’s signature. Look into who’s required to legally sign their name in order to access funds.
6. Accounts are exclusively for kids. Parents shouldn’t try to use children’s savings accounts to avoid taxes. The IRS has very strict rules governing the funds that are being held in a child’s savings account.

Read up on the best student savings accounts

Can I open a savings account for my baby?

Yes. If you’re a new parent, you can open a savings account for your child as soon as you receive their Social Security number. Depending on the financial institution, you may need to visit a branch with your child, or you might be able to do everything online. But generally, banks and credit unions follow the same steps.

1. Request an application to open a joint account.
2. Add your child’s name, address and Social Security number as the primary account holder.
3. Add your name, address, phone number, email address and Social Security number as the joint or secondary account holder.
4. Fund the account with cash, a credit card or a different bank account.

Eligibility

To open a bank account for your baby, you’ll need to meet the following eligibility requirements.

• At least 18 years old
• US resident

Required information

Be prepared to provide the following details when opening your baby’s bank account.

• Your and your baby’s name
• Your and your baby’s Social Security numbers
• Address
• Contact information
• Driver’s license or government-issued ID
• Some banks may require your baby’s birth certificate

Bottom line

The best savings account for kids teaches children how to set goals and manage their money, but it also comes with perks like no fees or minimum balances to help kids who are saving their allowance. While opening a kids’ savings account grants children the power to save, you can also consider other kids’ bank accounts to achieve financial goals and learning, such as a checking account or prepaid card. Review your kids’ bank account options to find the one or combination of accounts that serve you.