Best Savings Accounts For Kids: Safe, Low-Cost Options

Opening a savings account for kids is one of the simplest ways to teach children about money while helping them grow real savings over time. As a parent or guardian, the goal is to find an account that is safe, easy to use, has low costs, and pays a competitive interest rate so their money can grow faster.

Children in the U.S. often learn about money through real-life experiences, and financial education experts frequently recommend using tools like savings accounts and allowances as hands-on lessons in saving, spending, and setting goals. Many banks and credit unions now design accounts and digital tools specifically with younger savers in mind, which can help build strong habits early.

What Makes a Great Savings Account for Kids?

Before looking at specific types of accounts, it helps to know which features matter most. When comparing savings accounts for kids, prioritize options that are safe, low-cost, and easy to manage.

• Low or no minimum balance requirements – Accounts that require a large initial deposit or high ongoing balance can be hard for kids to use. Look for accounts that let you start with a small amount and keep saving over time.
• No monthly maintenance fee – Fees quickly erode small balances. Many banks offer accounts with no monthly fees, especially for minors or accounts tied to parents’ relationships with the bank.
• Competitive interest rates (APY) – A higher annual percentage yield helps savings grow faster. Online banks and high-yield savings accounts often pay significantly more interest than traditional branch accounts.
• FDIC or NCUA insurance – Choose banks insured by the Federal Deposit Insurance Corporation (FDIC) or credit unions insured by the National Credit Union Administration (NCUA), which protect deposits up to $250,000 per depositor, per institution, per ownership category.
• Convenient access and parental controls – Online access, mobile apps, and tools that let adults monitor activity and approve transfers can make it easier to supervise kids’ accounts and teach responsible behavior.^[10]

With these core features in mind, you can decide which type of account best fits your child’s needs and your family’s banking habits.

Best High-Yield Savings Accounts for Kids

High-yield savings accounts stand out because they offer above-average interest rates, helping kids’ savings grow more quickly. Many of the top-yielding accounts are offered by online banks, which typically have lower overhead and can pass savings on to customers through better rates.

Although individual bank products change over time, high-yield accounts for kids or joint parent–child accounts often share these characteristics:

• Higher APY than typical branch-based savings accounts
• No or very low minimum opening deposit
• No monthly maintenance fees
• Primarily online access, sometimes with optional ATM cards as the child gets older

An example of how powerful a high-yield rate can be: consumer education organizations note that if a child deposits $1,000 into a savings account earning 4% annually and leaves it untouched, it grows to about $1,217 in five years, thanks to compound interest. A lower-yield account would produce much less growth over the same period.

Best Online Savings Accounts for Kids

Online savings accounts are often the most flexible and highest-earning options for kids. Many banks allow parents to open a joint account or custodial account online, link it to their existing checking account, and then transfer funds as needed.

Reasons to consider an online savings account for your child include:

• Higher rates – Online banks have consistently led national rankings for savings yields.
• Easy supervision – Parents can log in anytime, view activity, and set up automatic transfers or savings goals.
• Real-world digital banking experience – With digital banking now the norm, starting kids on an online platform mirrors how they will likely manage money as adults.^[10]
• Low costs – Many online accounts have no monthly fees and low minimums.

Some families prefer to pair an online savings account with a branch-based checking account or prepaid card for older kids and teens. This allows savings to stay in a higher-yield environment while daily spending is handled elsewhere.

Best Money Market Accounts for Kids: Low Fees and Minimums

Money market accounts (MMAs) combine features of both savings and checking: they typically pay competitive interest rates and may offer check-writing or debit card access, although transaction limits often apply. For kids, a money market account can be useful if they have larger balances or if parents want a separate, slightly more flexible savings bucket.

When considering a money market account for a child, pay attention to:

• Minimum balance to open and earn top rates – Some MMAs require a higher minimum deposit or balance than standard savings accounts, which may not be practical for younger savers.
• Monthly fees and how to avoid them – Many MMAs waive fees if you maintain a certain balance; falling below it can trigger charges.
• FDIC or NCUA insurance coverage – As with any deposit account, confirm that the institution is insured.
• Access channels – Online-only, branch-based, or hybrid options affect how easily kids can see their balances and how parents supervise.

For households that already maintain substantial emergency funds, opening a money market account in a child’s name or as a custodial account can keep their savings in a relatively liquid account while still aiming for a competitive rate.

Best Branch-Based Savings Accounts for Kids

Branch-based savings accounts remain popular for younger children because they provide a tangible, in-person banking experience. Many kids enjoy visiting a branch, meeting tellers, and depositing cash from birthdays, holidays, or allowances.

Branch-based accounts designed for minors often feature:

• No monthly maintenance fee for account holders under a certain age
• Low minimum opening deposits
• Access to hundreds of local branches and ATMs
• Promotional programs, contests, or educational materials targeting kids

Parents who value in-person relationships or already bank with a regional or community institution may find it easier to open a child’s savings account at their existing branch. However, interest rates at traditional banks are often lower than those at high-yield online banks, so some families choose to split savings between the two.

Best Branch-Based Money Market Accounts for Kids

Some brick-and-mortar banks offer branch-based money market accounts that are accessible both in person and online. These accounts can appeal to families who want a physical location plus a relatively higher rate than a standard branch savings account.

Key considerations for branch-based MMAs for kids include:

• High minimums for best rates – It is common for the most attractive rate tiers to require larger balances, which may limit usefulness for younger savers.
• Monthly fees that can be waived – Fees are often waived when balances stay above a specified threshold or when tied to a broader relationship with the bank.
• Geographic limitations – Rates and availability can vary by region, and some promotions may be limited to certain markets.

Branch-based money market accounts may be better suited for older kids and teens who have already accumulated significant savings or who are managing funds for larger goals such as college or a first car.

What We Compared: Child-Friendly Savings Account Features

When evaluating savings accounts for kids, it is not enough to focus solely on the headline interest rate. A complete comparison should also account for how the account works in daily life and how effectively it supports a child’s financial education.

Competitive Interest Rate

Interest rates on savings and money market accounts change over time, sometimes frequently. Research from bank comparison sites and regulators shows that online institutions often maintain consistently higher yields than many large traditional banks, though individual offerings can vary. Because rates fluctuate, parents should compare current APYs when they are ready to open an account, rather than relying on older information.

Type of Access

The way your child accesses their account matters almost as much as the rate. There are three main access models:

• Online-only accounts – Accessed through websites and mobile apps; ideal for tech-savvy families and often paired with high interest rates.
• Branch-based accounts – Provide in-person service, which can help younger kids connect banking concepts with real-world experiences, like handing cash to a teller.
• Hybrid accounts – Offer both branch access and digital tools, sometimes including educational apps that encourage saving, sharing, and spending thoughtfully.^[10]

Fees, Minimums, and Insurance

Beyond access, several structural features determine whether an account truly suits kids:

• Monthly maintenance fees – Favor accounts with no monthly fee or easy ways to waive it, such as maintaining a modest balance or opting for electronic statements.
• Minimum balance requirements – Younger kids typically have small and irregular deposits, so low or zero minimums make it easier to keep the account in good standing.
• FDIC or NCUA insurance – FDIC and NCUA insurance protect depositors up to $250,000 per depositor, per insured bank or credit union, for each account ownership category. Verifying coverage is an essential step when opening any account.

How to Get the Best Savings Account for Your Child

Once you understand the account types and features, you can follow a step-by-step approach to choose and open the best savings account for your child.

1. Decide on the Account Structure

Most children’s savings accounts are opened as one of the following:

• Joint account (parent + child) – Both names appear on the account, and the adult typically maintains primary control while the child learns to manage money. Joint accounts are common for teens with debit cards.
• Custodial account (UGMA/UTMA) – An adult custodian manages the account until the child reaches the age of majority defined by state law, at which point control transfers to the child. These accounts are often used for longer-term savings goals.
• Minor savings account under a parent’s profile – Many banks offer specialized children’s savings under a parent’s customer relationship, with the parent as the legal owner and the child as a beneficiary or account holder.

2. Compare Rates and Fees

Next, compare current interest rates and costs across several institutions. Look for:

• Competitive APY relative to national averages
• No monthly maintenance fee
• Low or no minimum balance requirements
• Reasonable policies for withdrawals and transfers

Federal regulations allow banks and credit unions to limit certain types of withdrawals and transfers from savings and money market accounts, so it is important to understand any transaction limits before opening the account.

3. Consider Digital Tools and Education Features

Many modern kids’ accounts now include financial education tools. Examples include:

• Goal-based savings trackers where kids can label goals like “bike” or “college” and see progress each time money is added^[10]
• Allowance and chore-tracking apps linked to accounts to automate deposits
• Parental dashboards where adults approve transfers or set spending limits
• Alerts for deposits, withdrawals, and low balances

Research on youth financial education suggests that combining practical money experiences with guidance from adults helps kids develop stronger habits and confidence around money management.

4. Open and Fund the Account

When you are ready to open the account, banks generally require:

• Identification for the parent or guardian (such as a driver’s license or passport)
• The child’s legal name, date of birth, and Social Security number
• A minimum opening deposit, if required

At many institutions, you can complete this process online in a few minutes, especially if you are already a customer. Others may ask you to visit a branch when opening the account for a minor.

5. Use the Account to Teach Money Skills

After opening the account, the real value comes from how you and your child use it. Some practical ideas include:

• Setting a regular savings habit, such as depositing a portion of weekly allowance or birthday money
• Reviewing monthly statements together and discussing interest earned
• Creating short-term and long-term goals, such as saving for a toy versus saving for college
• Exploring digital tools that show how small deposits add up over time

Using the account actively reinforces lessons about delayed gratification, planning, and the benefits of starting early.

Frequently Asked Questions (FAQs)

Q: What is the best type of savings account for a young child?

A: For young children, a simple savings account with no monthly fees, low minimums, and FDIC or NCUA insurance is often best. Many parents choose either a branch-based kids’ account for the hands-on experience or an online high-yield savings account to maximize interest.

Q: How old does my child need to be to have a savings account?

A: In most cases, a child of any age can have a savings account as long as a parent or guardian opens it as a joint or custodial account. Banks set their own rules, but minors generally cannot open accounts independently until they reach the age of majority in their state.

Q: Is my child’s money safe in a savings account?

A: If the account is held at an FDIC-insured bank or NCUA-insured credit union and total deposits stay within coverage limits, your child’s money is protected in the event the institution fails. You can verify coverage using tools provided by FDIC and NCUA.

Q: Should I use an online or branch-based account for my child?

A: Online accounts often pay higher interest and are convenient for parents who prefer digital banking. Branch-based accounts are better if you value in-person experiences, such as letting your child physically deposit cash and talk with bank staff. Many families choose a combination of both.

Q: Can my child get a debit card with their savings account?

A: Savings accounts themselves usually do not come with debit cards for minors, but some banks offer linked teen checking accounts or prepaid cards for older children and teenagers. These products are typically managed jointly with a parent, with built-in controls and monitoring tools.

This article is general information, not personal financial advice. Consider your own situation, or speak with a licensed adviser, before acting on it.