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Parents get their kids’ savings started young

Parents get their kids’ savings started young

Category: Savings

Updated: 05/09/2011
First Published: 05/09/2011

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

More and more parents are opening their children's first savings accounts before their offspring can walk.

Over a quarter of children (26%) are having savings accounts opened for them before the age of two.

Many parents will hope that the savings will be used to help pay for university fees or the cost of learning to drive when their children grow up.

Until recently, the Government put £250 towards savings for all newly born children, although this was stopped as part of the Government's cost cutting measures.

Junior ISAs will be introduced in November this year, but the onus to begin saving for children will remain with parents.

Children will not be able to manage their account until they are 16 or withdraw funds before they are 18 – a big plus point for many.

Over half (51%) of UK mums and dads said it was important they had overall control of their children's savings pot.

Nearly three quarters of parents (72%) said their child has no access to their savings account, with a trusting tenth (10%) of parents allowing their child full access to their savings account.

A compromising sixth (16%) of parents said their child saves into his or her account but is not allowed to withdraw money.

Parents should ensure they've done their research before they plump for a savings account for their children, however, as recent research found that some accounts for kids pay as little as 0.05%.

But there are accounts such as the Little Rock from Northern Rock which pay rates of 3.00%.

If you're keen to build up a nest egg for your young ones then begin your search at the Moneyfacts.co.uk Best Buy tables.

Find the best savings rates for you - Compare savings accounts

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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