Finding the best account for kids who want everything

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RateCity looks at the release of Bankwest's Kids' Bonus Saver Account and shows you how your kids can start building a healthy little piggy bank for themselves.

April 29, 2010

Kids continuously have something in mind that they want. Whether it's a new bike, guitar or clothes, there is always something new and exciting that they just have to have. If you have children under the age of 15, now is the time to get more out of their money by taking advantage of Bankwest's Kids' Bonus Saver Account which is offering a high interest rate of 10 percent per annum.

This award-winning kid's account holds one of the highest interest rates on the market according to RateCity, with Westpac following behind at 5.95 percent for both their Kids' Reward Saver and their Youth Reward Saver. In comparison, one of the best adult online savings account on RateCity is at 6 percent by ING Direct.

Sounds too good to be true?
Like most savings accounts, there are a few catches that come with receiving the great offer. For instance, your child must have an existing Bankwest children's savings account to link to their new Kids' Bonus Saver and even though there is no minimum amount required for an opening deposit, they have set a maximum amount of $250.

Once your account is active, you are allowed to deposit between $25 and $250 only per month and if you don't make any withdrawals you will receive the 10 percent bonus interest. The good news is that there is no monthly account keeping fees and interest earned is paid monthly.

So if you were to deposit the maximum amount of $250 per month ($3000 in total), you will earn about $141 in interest over the year if the rate stays the same. From a kid's point of view that is a lot of money, but keep in mind that is the maximum amount they will be able to earn in interest per year.

After one year, the balance is automatically transferred to the linked account and your child must start their savings again.

Help your child get more out of their saving account
If your child earns more than $25 a month in pocket money then this may be the perfect account for them, as long as they don't want to withdraw any of their funds in the next 12 months.

To help your kids with their saving and reach their goal, here are some ways they can get more out of their saving account:

  • Look for a children's savings account that offers a high interest rate by comparing online at RateCity.
  • If possible, deposit more than the minimum amount each month to see their money grow faster.
  • Make sure they understand how their account will work in terms of all the conditions to receive the maximum amount of interest.
  • Set up an automatic transfer so you don't have to remember to pay your child each month. They can go online to see that you have made the payment and see their cash grow in the mean time.

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