Savings Accounts for Children
As parents hoping to raise financially savvy kids, one of the best things we can do is expose them to banking concepts at an early age. Savings accounts for children offer many great personal finance lessons such as the importance of saving money, the magic of compound interest, and the basic mechanics of banking.

Photo by theritters
When I was in high school I took a class called “Citizenship.” The coursework was divided logically between a number of “civic” topics such as taxes, politics, law, and even a very brief introduction to personal finances.
Since I began working the day after I turned 16, I was very familiar with basic checking and savings (well, I had a savings account, but save the $0.03 interest accumulations each month, I wasn’t very good at adding to it).
Back to Citizenship 101. The time came for students to balance our own checking register, write out our own checks and complete a deposit slip. My classmates were stumped, and I even made a little fun of a friend of mine for not knowing how to fill out a check.
He innocently responded that he had never even seen his folks write a check, and he joked that the only bank he knew of was his piggy bank. I suppose that is probably the average level of exposure kids are given to the world of personal finance. That is, until they are on their own and must learn on the fly. I distinctly remember thinking my kids would know how to navigate banking well before they had to know how.
Opening Savings Accounts for Children
It’s funny how fast 20 years seem to fly by. Fast forward a couple decades and here I am with kids who have been introduced to the concept saving and investing, but have not yet learned the mechanics of banking. Shame on me. My 16 year-old self would kick my butt for not teaching this before now. Better late than never, I suppose.
Last Saturday, my daughter and I strolled into our local bank to open a savings account for her. Until now, she saved at home, and I deposited larger amounts into an account for her online. While the interest rate was a little better for her online savings account, investing there caused us to bypass the act of allowing her to make a deposit herself – something I believe is important, psychologically.
With my guidance, she walked up to the teller with some of her hard-earned allowance money and completed deposit slip. In return, she received an updated account notice reflecting the amount of her deposit and increase in her balance. She updated the balance in her savings account register.
In a few weeks, we’ll receive her first savings account statement. I’ll point out the interest that has accumulated since the last statement (her first introduction to passive income), and we’ll update the register to reflect the new statement balance. At some point, I know she’ll want to withdraw a bit of this money for a purchase, and I’m fine with that. In fact, I’ll encourage it (and use it as another teaching opportunity)!
Witnessing the reverse of the deposit process is just as powerful. She’ll fill out a withdrawal slip, receive some cash from the teller and spend it. She’ll then have to reduce her savings balance in her register, and she’ll notice the balance reduction on her statement (and a smaller interest accumulation next month).
By then, she will have probably have forgotten what it is she took the money out for in the first place, and it’s my hope that the next time she considers withdrawing money, she remembers the disappointment she felt watching her balance dwindle.
A few years down the road, we’ll also add a student checking account for our children. We’ll practice completing checks, balancing her checkbook, and I’ll probably include something like “Lunch Money” in her allowance and let her write the check to her school to fund her account.
In the mean time, I’ll let the kids help me pay a few bills by check (I think I’m down to only one or two bills that I still write checks for). This way, they’ll get a lesson in how to write checks, and how much it costs each month to have water come out of the faucet!
Have you introduced your kids to banking concepts? Share your experience in the comments below.







