You should teach your child the importance of saving money at an early age. So, consider opening a bank account for your baby as he/she gets older. That way, the little one can save cash he/she receives from relatives, the money you contribute on their behalf, and the dollars they win at competitions. You should also let your kid know that saving is a significant step toward financial freedom.
But, when should you open a bank account for your child?
Here’s a guide to get you going;
Is the There a Right or Wrong Time to Open a Bank Account for Your Child?
The biggest question is not when you should open a bank account for your child, but whether there is a right or wrong time to do so. Some parents say that there is no right or wrong time to open a bank account for your kid.
For some parents, this may mean opening an account when the young one is an infant and piling away all the money they receive as gifts or regular monthly contributions. For other families, it might imply waiting until the kid in school or until they starting earning small amounts of money on their own. Nonetheless, most financial experts say that the best age to open a bank for your kid is between 8 and 10 years.
Which Bank Account Should You Choose?
Unless your kid is a young entrepreneur who is receiving and writing checks as well as paying bills, you should open a savings account for them. This is because a savings account has higher interest rates and fewer rates. The best savings account for your child should;
- Have no minimum balance requirement
- Have no monthly maintenance fee
- Have an online account management
- Have a high-interest rate
How Do I Open a Bank Account for My Child?
For starters, you should open the bank at your local branch where you can have easy and fast access. Take your child to the bank alongside the following documents;
- Your kid’s Social Security number and birth certificate
- Your identification documents such as a driver’s license
- Your details such as your address, email, and date of birth
The initial deposit
Because the child is not in a position to open the account, cooperate fully with the bank officials. Keep in mind that some banks may ask for an “an identification” card so be sure look at this special offer at www.easyidcard.com. The idea is to get an expertly designed card to accompany other documents required to open the account.
How Do I Use, and Teach My Child about Money
Once you have opened a bank account for your child, it goes without saying that you will get more opportunities to teach them about money. Make sure that he or she understands that the bank is keeping the money and that the money is earning interest and growing. Come up with a saving plan and help your child stick to it.
In conclusion, let the child add the accumulated savings manually so that they can “watch their money grow” each time you make a deposit. Show your kid how to keep track of their interest. Celebrate the savings achievement as a way of encouraging the little one to save even more money