Choosing a bank account for your child
One of the things you may have considered if you are a parent is how you can give your child an education in managing and saving their pocket money. Preparing them for the future can be important, so helping them set up their first bank account might be an essential first step.
By doing this you may be providing them the opportunity to make the most of their pocket money, or simply helping them to realise that they can save to buy those seemingly all-important purchases. Whether it is a new bike, computer, mp3 player, games console or pair of trainers, it can often seem as if there is no end to their expensive tastes. With this in mind, getting your son or daughter to put their cash into a bank account will help them learn that there are benefits to being smart with their money. Many accounts offer a tax-free variable interest rate, which is often paid on a quarterly basis.
There are also a number of current accounts for children that you might feel could help teach your youngster the benefits of careful money management. In fact, you could find your son or daughter is in a much stronger position in later life if they are equipped with the skills to avoid overspending and budget for the things that are important to them. This can be particularly important once they start their first part-time or weekend job and begin to see how their funds come in and inevitably go out. As they get older, days out with friends, music downloads, mobile phone top-ups and clothes are likely to be important to them, making their account the best place to keep track of their cash.
The importance of a solid financial education was highlighted in a recent article for Citywire by Patrick Jones, a young British male who felt that he had not been provided the skills he needed in this area when leaving school. Jones shared his experiences at the age of 18 as he left education with a less than adequate understanding of things like interest rates, mortgages and bank accounts. He added that with the exception of a few difficult to remember “dull talks”, he felt none the wiser on the matter. He went on to welcome government plans to do more to teach children about this important subject. However, Mr. Jones also pointed out that there was little logic in bombarding particularly young children with complex financial matters. He said kids aged five and upwards would probably fall into this category as they have yet to acquire basic arithmetic skills. But with this in mind, setting up an internet bank account yourself for your son or daughter might make even more sense, as it will put you in control of how much the child is learning as they grow.
