Martin Lewis explains the best bank account for children’s savings

Martin Lewis made an appearance on ITV's This Morning to talk children's savings accounts.

The founder of Money Saving Expert explained the best way parents can save cash for their young children.

Martin told those watching that they should get their children clued up on finances as soon as possible, educating them about the concept of money.

During the show, Martin told Holly Willoughby and Phillip Schofield which accounts were the best for savings and the methods to avoid.

It comes after he explained which savings accounts were the best, even if you don't have much to put away.

He said: "On interest, the easy winner is the Halifax Kids' Regular Saver (up to age 15), which pays 4.5% AER fixed for a year.

"You can only pay in between £10 and £100 per month. You are allowed to miss months, but can’t withdraw any money until the year is up.

  • Martin Lewis on best savings accounts – even if you don't have much to put away

  • Martin Lewis shares 'best' tip on saving money on energy bills this winter

"You can open and access it online or in branch. After a year, the rate drops, so get your child to set a diary reminder and move their money to a better account when it does.

"If you need another, Saffron Building Society is similar but pays 4% AER and you can make withdrawals from it, though you can only open and manage it in branch or by post."

The HSBC My Savings account Martin advised for larger sums, as it pays 3% AER on up to £3,000.

If children are aged 11-18, the Santander 123 Mini account pays 3% on £300-£2,000 and gives a contactless debit card to use in shops.

Read More

Martin Lewis

  • Martin Lewis' Boots Black Friday deals
  • Martin Lewis shares incredible M&S deal
  • MSE founder shares how to get free £175
  • How to get £135 on General Election

However, those under 13 need you to have a Santander current account and open it for them in a branch.

And speaking about Junior ISA's, Martin said: "The big benefit has always been that the interest is tax-free, but unless your children have big earnings or enormous savings their money isn’t taxed anyway, so there’s no gain.

"There’s a rule that says kids’ can only earn £100 interest a year (so that’s about £3,000 saved in the top easy-access account) from money given by each parent."

He added: "The only reasons for using a Junior ISA is as a way to lock money away until they’re 18 – or to earn a little more on lump sums. The top top-paying JISA cash accounts is from Coventry BS paying 3.6% AER."

  • Martin Lewis
  • Money

Source: Read Full Article