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Best savings accounts for kids for 2023
Top kids savings accounts come with high rates and goal-setting features.
The best kids’ savings accounts emphasize high interest earnings while keeping fees low or nonexistent so that young savers can stash away more of their money. See which of these top accounts suits your goals for your kids — whether that’s earning interest, setting savings goals or introducing advanced tools like investing.
Quick view: Best savings accounts for kids
- Best for few fees: Discover Online Savings Account
- Best joint account for high interest: UFB Preferred Savings
- Best for teens: Capital One 360 Performance Savings
- Best savings tools: Ally Bank Online Savings Account
- Best for custodial accounts: Alliant High-Rate Savings
- Best for growing with your child: Alliant Kids Savings Account
- Best for customer support: First Internet Bank Tomorrow’s Tycoons
- Best for savings bonus: Greenlight Savings
- Best for growing money with investing: BusyKid
- Best for learning about saving: GoHenry
- Best customizable savings tools: FamZoo
- Best for parent-paid interest: Till Financial
6 best savings accounts for kids
Top savings accounts help your kids grow their money with high rates. But since most kids savings accounts don’t rise above a 1% APY, we’ve also included adult savings accounts that allow you to open it jointly with a minor or as a custodial account.
Best for few fees
Discover Online Savings Account
Finder Rating: 4.6 / 5 ★★★★★
Discover avoids as many fees as possible, forgoing its monthly fee and minimum balance requirement. It also doesn't charge for occasionally going over the six-withdrawal limit. Aside from charging $30 for outbound wires, you won't see any other account-specific fees. You'll need to call to set this account up as a custodial account, which gives you control until your child becomes an adult.
| APY | 3.60% |
|---|---|
| Fee | $0 |
| Minimum deposit to open | $0 |
verified_user FDIC Insured
Best joint account for high interest
UFB Preferred Savings
Finder Rating: 5 / 5 ★★★★★
Although this is a savings account for adults, you can add a minor as a joint account holder. It comes with one of the highest interest rates for a savings account at 5.02% APY – this is more than 18 times higher than the national average. Although the account has tiered rates, you currently earn the highest APY on any amount. But this could change at any moment.
| APY | 5.02% |
|---|---|
| Fee | $0 |
| Minimum deposit to open | $0 |
verified_user FDIC Insured
Best for teens
Capital One 360 Performance Savings
Finder Rating: 4.6 / 5 ★★★★★
If you want a user friendly savings account, Capital One 360 Performance Savings fits the bill. You can open the account and add your teen as a joint owner directly online. Then, open multiple savings accounts for individual goals — and your teen can nickname them to match their goal. They'll also get access to the top-rated mobile app to manage their savings, and Capital One Cafès and branches are available if they ever need in-person help. Capital One does offer a kids' savings account but with a negligible 0.30% APY, so we recommend opening this option as a joint account.
| APY | 3.30% |
|---|---|
| Fee | $0 |
| Minimum deposit to open | $0 |
verified_user FDIC Insured
Best savings tools
Ally Bank Online Savings Account
Finder Rating: 4.4 / 5 ★★★★★
Once you open the account for you and your child online, they can dive into the user friendly app to set up to 10 savings goals and track progress. Plus, if you link your checking account, you can boost your kid's savings by rounding up purchases and sending them the spare change. Ally can also check your linked account for unused money to save, and give your kid customized suggestions to help them save more.
| APY | 3.40% |
|---|---|
| Fee | $0 |
| Minimum deposit to open | $0 |
verified_user FDIC Insured
Best for custodial accounts
Alliant High-Rate Savings
Finder Rating: 4.3 / 5 ★★★★★
Alliant helps your child earn a competitive 2.95% APY on any balance above $100 in their account. Open the main custodial account and then create up to 19 supplemental accounts to organize different savings goals. Alliant will even spot the $5 opening deposit for you, and you can bypass the $1 statement fee by going paperless.
Alliant wins best for custodial accounts since it offers several custodian accounts like CDs and a noncustodial kid's savings account that also earns a spot on our best list.
| APY | 2.95% |
|---|---|
| Fee | $1 per month |
| Minimum deposit to open | $5 |
verified_user FDIC Insured
Best for growing with your child
Alliant Kids Savings Account
Finder Rating: 4.6 / 5 ★★★★★
Alliant Kid's Savings Account earned a spot on our Finder Awards for 2022, earning a competitive 2.95% APY for a kid's account. It's ideal if you want to start your child off with a savings account before opening the Alliant Teen Checking account later. It also comes with an ATM card that you can use to withdraw money from over 80,000 ATMs, a rare feature for any savings account let alone for kids' savings. Although there's a $1 monthly fee, it's waivable when you sign up for e-statements.
| APY | 2.95% |
|---|---|
| Fee | $1 per month |
| Minimum deposit to open | $5 |
Best for customer support
First Internet Bank Tomorrow’s Tycoons
Finder Rating: 4.3 / 5 ★★★★★
While it's a fully digital bank, First Internet Bank makes an effort to put faces with names when you're chatting with customer support. Its site allows you to choose an available customer rep and reach out to them by phone or chat directly. It offers a solid APY of 0.8% — rewardable only after a $100 opening deposit. It also converts to a Free Savings account when your child turns 18 so you don't have to worry about switching to another adult account.
| APY | 0.80% |
|---|---|
| Fee | $0 |
| Minimum deposit to open | $100 |
Savings tools to help kids grow their money
Apart from savings accounts, kids’ apps have been a huge hit for parents looking for accounts that help teach and encourage their kids to save. Some popular options include:
Best for savings bonus
Greenlight Savings
Greenlight Savings is a feature housed inside a kids' debit card platform and not an actual savings account. In addition to parent-paid interest, which lets you set how much your kid earns on their savings, Greenlight includes savings bonuses up to 5%, depending on which plan you choose. The Greenlight Core plan lets kids earn a 1% savings bonus per year, while Greenlight Max earns 2% and Greenlight Infinity earns 5% per year. So if your kid has $1,000 in savings, they could earn around $50 in one year with Greenlight Infinity versus $10 with Greenlight Core.
| APY | 1.00% |
|---|---|
| Fee | $4.99 per month |
| Minimum deposit to open | $0 |
Best for growing money with investing
BusyKid
Finder Rating: 4.6 / 5 ★★★★★
BusyKid packs in features encouraging kids to boost their savings balances, including tools to automatically save part of their allowance. Parents can match any amounts that kids put in savings, and anyone can add to a kid's account instantly using the BusyPay QR code. Kids can also go beyond saving to investing in 4,000+ stocks and ETFs at no extra monthly cost, unlike competitors that charge extra for investing features.
| Annual or monthly fee | $48 per year or $4 per month |
|---|---|
| ATM withdrawal | $1.50 |
Best for learning about saving
GoHenry
Finder Rating: 4.3 / 5 ★★★★★
GoHenry helps kids focus on saving by automating savings from their allowance. If parents set up parent-paid rewards, kids can also get paid for learning about finances through GoHenry's interactive Money Missions games and quizzes. At the same time, parents can limit kids' spending by choosing how much they spend at certain stores.
Get an extended 2-month free trial of the GoHenry kids' debit card and app when you sign up with Finder's exclusive code: AFUSS171. Offer ends on April 6, 2023.
| Annual or monthly fee | $4.99 per month |
|---|---|
| ATM withdrawal | $1.50 |
Best customizable savings tools
FamZoo
Finder Rating: 3.6 / 5 ★★★★★
FamZoo offers a customizable approach to savings tools for kids. Parents can create multiple prepaid card accounts per child to save and spend for different purposes, ideal for envelope budgeting. Doing so lets kids spend directly from the card and instantly transfer money between cards. Otherwise, parents can set up subaccounts to track their kids' savings numbers without moving real money around.
| Annual or monthly fee | $5.99 per month |
|---|---|
| Additional Card Fee | $0 $3 Additional Card Fee (after first 4 free cards) |
| ATM withdrawal | $0 |
Best for parent-paid interest
Till Financial
Finder Rating: 4.6 / 5 ★★★★★
Till Financial goes a step beyond savings goals, letting parents customize how they contribute to kids' savings. Parents can pay interest on the amount or match a percentage of what their kids put into savings. Or they can contribute a flat amount weekly, like an allowance for kids' savings. Parents also have to give their okay before kids move money in and out of savings.
| Fee | Free |
|---|---|
| Minimum deposit to open | $0 |
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.
5 ways to find the best savings account for my kid
When shopping around for the best savings account for your kid, look for these features:
- Interest rate. You may want to shop around for accounts with higher interest rates before making a decision. Some banks also offer promotional rates and other incentives, so it’s worth seeing what’s out there.
- Deposit methods. Check to see if your child has a school banking program in place, which would allow your child to make deposits while at school. If not, you can always open an account for your child and take them to the bank once a month to show them how to physically deposit their pocket money.
- Monthly fees. There may not be any account maintenance fees for a kids’ savings account, but you should pay attention to any monthly withdrawal limits or fees.
- Minimum opening deposit. Some kids’ savings accounts come with a minimum opening deposit — usually around $25 — so compare your options if you’re looking for an account that doesn’t have this requirement.
- Special educational programs. Some banks have programs that give children access to online educational portals, and some even provide rewards such as a $5 starter deposit and stationery to help children learn about saving and finances.
Can I open a regular savings account for my kid?
Yes. Not all banks offer dedicated savings accounts for kids, but many banks still let you open a standard savings account as a joint or custodial account with your child. Doing so lets you take advantage of higher interest rates than many kids’ savings accounts offer.
However, if your kid is under the age of 18, you or another parent or guardian will need to be a joint owner of the account. As a joint owner of a savings account, you and your child will both have unrestricted access to the funds in the account.
7 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.
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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:
- 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.
- 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.
- 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.
- 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.
| JFCU | Alliant | Northpointe | Capital One | |
|---|---|---|---|---|
| Age limit | Under 18 | Under 13 | Under 18 | Under 18 |
| What happens to the account at the age limit? | Automatically converts to Student Rewards Checking Account | Option to open Teen Checking Account | Not stated on website | Not stated on website |
| Signatory requirements | Parent, guardian or other adult with verified identity | Parent, guardian or other adult with verified identity | Parent, guardian or other adult with verified identity | Parent, guardian or other adult with verified identity |
| Who can make transactions? | Not stated on website | Parents and children | Not stated on website | Parents, and children with signature from parent |
| Special eligibility requirements | Must hold a JFCU membership and savings account with $5 minimum deposit | Must hold an Alliant membership | Not stated on website | Not stated on website |
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.
- 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.
- 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.
- 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.
- The taxes could be quite high. Children’s savings accounts are still subject to taxes, especially if the amount exceeds the kiddie tax threshold.
- 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.
- Limited ATM access. Although some savings accounts for kids, such as Regions Savings for Minors, come with ATM cards, most do not.
- 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.
- 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.
- 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.
- Request an application to open a joint account.
- Add your child’s name, address and Social Security number as the primary account holder.
- Add your name, address, phone number, email address and Social Security number as the joint or secondary account holder.
- 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.
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