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Compare the best children's savings accounts

Find the right account to save for your child’s future
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Last updated
January 31, 2023

What is a children’s savings account?

A children’s savings account is very similar to a savings account for adults and they are offered by banks and building societies. It is also a good way to educate children about money and encourage them to save in the future.

In essence, it’s a simple and safe way to save for your child’s future, whether that’s saving for university fees or a deposit for their first house.

When choosing the most suitable savings account, think about your long-term savings goals for your child and whether the account ticks important boxes like accessibility, a good interest rate and whether it is easy to manage for yourself or your child.

Average yearly amount saved in a Junior ISA for their child[1]
£5,740

How can I open a savings account for my child?

Most banks enable parents or guardians to open an instant access savings account, regular saver and fixed-term bonds for their child with just £1. Some savings accounts allow children over seven years old to open an instant access account and fixed term bonds, but they need the application to be signed by their parent or guardian. 

To get the process started, you can either open an account in the branch, online or by post.

If you decide to apply online or by post you’ll probably need to have an existing account with your chosen provider. If you choose a different bank, you’ll need to provide proof of identification before the account can be opened. This means you’ll need identification for yourself and your child. 

Accepted identification includes: 

  • Passport 

  • Birth certificate 

  • Proof of address

fscs-logo
Is my money safe?
The Financial Services Compensation Scheme (FSCS) guarantees that the first £85,000 you have saved with a registered bank or building society (or first £170,000 for a joint account) will be safe even if the business goes bust.

The best children's savings accounts deals

We’ve compiled the best children's savings accounts deals currently on the market so you can see which provider might best suit your needs.

Editor’s pick
One of the highest interest rate for Childrens - Regular saver
Card
HSBC MySavings
Open with
£10
Interest rate
3.75% AER variable on £10 to £3,000
Term
Instant access

No notice, penalty, or charge applies.

Show Details
Eligibility
Maximum Age
17 years
Minimum Initial Deposit
£10
Maximum Initial Deposit
Unlimited
Permanent UK Resident
YES
Rate Tiers
Gross rate
Including bonusExcluding bonus
3.69%3.69%
1.25%1.25%
AER rate
Including bonusExcluding bonus
3.75%3.75%
1.25%1.25%
Editor’s pick
One of the highest interest rate for Childrens 2 years Fixed rate bond
Card
HSBC Premier MySavings Ex/C
Open with
£10
Interest rate
3.75% AER variable on £10 to £3,000
Term
Instant access

No notice, penalty, or charge applies.

Show Details
Eligibility
Maximum Age
17 years
Minimum Initial Deposit
£10
Maximum Initial Deposit
Unlimited
Permanent UK Resident
YES
Rate Tiers
Gross rate
Including bonusExcluding bonus
3.69%3.69%
1.25%1.25%
AER rate
Including bonusExcluding bonus
3.75%3.75%
1.25%1.25%
Editor’s pick
One of the highest interest rate for Childrens Easy access Junior Cash ISA
Card
Danske Bank Danske Discovery Savings
Open with
£1
Interest rate
3% AER variable
Term
Instant access

No notice, penalty, or charge applies.

Show Details
Eligibility
Maximum Age
17 years
Minimum Initial Deposit
£1
Maximum Initial Deposit
Unlimited
Permanent UK Resident
YES
Rate Tiers
Gross rate
Including bonusExcluding bonus
3%3%
AER rate
Including bonusExcluding bonus
3%3%
The editorial team regularly checks the rates and top picks on this page, updating them at least fortnightly.

The different types of children’s savings accounts

Easy access children’s savings accounts
Easy access children’s savings accounts

This account allows you to pay money in and take it out whenever you wish. This means you can top it up to suit your financial needs rather than being forced to save a certain amount each month. However, this accessibility comes at a price as the accounts normally offer a lower interest rate.

Fixed-rate children’s savings accounts
Fixed-rate children’s savings accounts

Alternatively, if you would like to lock away your children’s savings for up to five years, a fixed-rate bond could be a good option. This normally gives you a more competitive interest rate and it is fixed, so you’ll know how much interest you can earn after a period of time.

But, with a fixed-rate you’ll be penalised if you make withdrawals and this isn’t a suitable account if you wish to keep adding funds throughout the years.

Notice children’s savings accounts
Notice children’s savings accounts

A notice savings account means you have to give the bank advance warning before you want to withdraw money. The timescales of notice can vary but it’s normally between one to three months. If you take money out before the notice period then you’ll experience fines, so it's not a good option if you need money in an emergency. The good news is the notice period is rewarded with higher interest rates in comparison to an easy access.

Regular savings account for children
Regular savings account for children

A regular savings child account also normally pays a higher rate of interest as it requires you to make regular payments into the account. These payments could be monthly and over a 12-month period, so this commitment needs to be considered before you take the leap.

Junior ISA
Junior ISA

A junior ISA is a way to save for your child’s future tax-free. ISAs work slightly differently from children’s savings accounts as you have a junior ISA allowance each tax year, limiting how much you can add to the account. For example, for the 2021/22 tax year the limit was £9,000.

The different types of children’s savings accounts
Easy access children’s savings accounts
Easy access children’s savings accounts

This account allows you to pay money in and take it out whenever you wish. This means you can top it up to suit your financial needs rather than being forced to save a certain amount each month. However, this accessibility comes at a price as the accounts normally offer a lower interest rate.

Fixed-rate children’s savings accounts
Fixed-rate children’s savings accounts

Alternatively, if you would like to lock away your children’s savings for up to five years, a fixed-rate bond could be a good option. This normally gives you a more competitive interest rate and it is fixed, so you’ll know how much interest you can earn after a period of time.

But, with a fixed-rate you’ll be penalised if you make withdrawals and this isn’t a suitable account if you wish to keep adding funds throughout the years.

Notice children’s savings accounts
Notice children’s savings accounts

A notice savings account means you have to give the bank advance warning before you want to withdraw money. The timescales of notice can vary but it’s normally between one to three months. If you take money out before the notice period then you’ll experience fines, so it's not a good option if you need money in an emergency. The good news is the notice period is rewarded with higher interest rates in comparison to an easy access.

Regular savings account for children
Regular savings account for children

A regular savings child account also normally pays a higher rate of interest as it requires you to make regular payments into the account. These payments could be monthly and over a 12-month period, so this commitment needs to be considered before you take the leap.

Junior ISA
Junior ISA

A junior ISA is a way to save for your child’s future tax-free. ISAs work slightly differently from children’s savings accounts as you have a junior ISA allowance each tax year, limiting how much you can add to the account. For example, for the 2021/22 tax year the limit was £9,000.

Interest earned over 18 years in children's savings accounts
Comparing average interest earned on £1,000 over 18 years in children's savings accounts

Source: Defaqto and Uswitch. Updated: December 11

Children's savings accounts FAQs

How does Uswitch choose its editor’s picks?

We know that the best deals are always changing, so the editorial team at Uswitch regularly checks the rates on this page and updates them at least fortnightly. To find the best deals we compare products by taking various factors into consideration, like the interest rate (AER), the balance needed to get the highest interest rate, minimum initial deposit, withdrawal conditions and the term of the account as applicable. These factors change subject to the category.

We use this system for the whole of the market covering nearly all, so you can get an overview of what the banks and credit unions are typically offering in the UK. All the banks featured are FSCS protected, so you can be reassured that your money is safe, provided it’s within the defined limits and regulations. To find out more about how FSCS looks after your money, visit fscs.org.uk.

Do children pay tax on savings?

If you open a junior ISA for your child this is tax-free, but it’s not as straightforward for children’s savings accounts. Accounts aren’t taxed but that doesn’t mean they are tax-free. If your child gets more than £100 in interest from money then the parent, then the parent will have to pay tax on all the interest if it’s above their own Personal Savings Allowance


Can my child control the savings account?

A child cannot control a savings account until it is solely in their name. If you open a savings account on behalf of your child, the account will move into their name when they turn 16 or 18 depending on the type of account. 


Can my child open their own savings account?

When your child is 13 years old they are able to open an account with whichever bank they choose. 


Which account is best if I have a lump sum of money to save?

If you don’t need the money in the foreseeable future, a fixed term bond in your child’s name would be suitable. It normally offers higher interest rates as a reward for not touching the money for a long period of time.

About the author

Lucinda O'Brien
Lucinda O'Brien has spent the past 10 years writing and editing content for regional and national titles. She applies her industry knowledge to ensure readers can make confident financial decisions.
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References
1. Gov.uk annual savings statistics: Average junior ISA subscriptions in 2019 to 2020 were around £5,740