Teaching your children how to be responsible with money is, for many parents, a necessary and ongoing process to equip them for the adult world.

And one of the most popular ways to introduce them to the world of finance and establish a platform to learn many of those lessons is to set them up with a kids’ bank account.

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So where do you start with a kids' bank account?

Most Australian banks and financial institutions offer bank accounts specifically designed with kids in mind. Kids’ bank accounts have a range of common features that vary slightly to allow you to select one that best suits your needs.

Depending on your child’s age, they will generally need a parent or guardian to act as a signatory to help them set up their account online or at a branch, and the parent to retain a level of control.

Some institutions, however, will also have a minimum age limit over which a child can open a bank account themselves.

The individual policy of the particular bank or financial institution you use will detail all the documentation you need to open the account, so you can go along to the branch prepared. However the basic requirements you will usually need to open an account are:

  • Proof of the child’s ID – i.e. a birth certificate
  • Proof of parents ID – i.e. birth certificate, passport or driver’s licence
  • Proof of home address

Getting your child involved in the process of setting up the account from the very beginning can be a wise idea. Depending on their age, this could help them gain an appropriate level of understanding of the process, the benefits and the responsibilities that go with having a bank account in their own name.

How do kids’ bank accounts differ from each other?

If you compare accounts based on the following features, it will allow you to make a more considered decision based on all the costs and benefits associated with each product offering.

  • Age eligibility – Some financial institutions may have a certain age limit on who can apply for kids’ bank accounts, but in general terms the child should be under 18 years of age. Check the eligibility criteria for each account you’re looking at.
  • Fees – There typically aren’t ongoing monthly fees attached to kids’ bank accounts, but there may be a number of one-off fees that are applied for certain transactions, such as over-the-counter withdrawal fees. Check under which circumstances an account holder may incur a fee; and if there are certain account keeping fees that may be payable, you will need to factor that into your cost calculations.
  • Interest – There can be a significant discrepancy on interest rates attached to kids’ bank accounts. There may also be additional monetary incentives for children to reach particular saving levels in a saver account, such as a bonus interest rate additional to the base rate. Read the fine print to see if there are any caveats or restrictions on when a bonus interest rate or bonus payment applies.
  • Accessibility – Investigate each provider’s service offering and to what extent you can obtain information such as the account balance, make deposits, transfer funds and make withdrawals through ATMs, phone banking, internet banking and mobile banking. Each provider will offer different access to their retail network.
  • Type of account - The type of kids' bank account will also determine some of the available features. For example, if it's a kids' savings account, funds may not be accessible by ATM. However, if it's a transaction account, it may come with an eftpos or debit card.
  • Cards and statements – For regular users, check to see if there is a transaction card offered with the account and also how often account statements are provided.
  • Deposit conditions – There may be a minimum monthly deposit required in order to be eligible to receive all the benefits.
  • Financial literacy and education – Some account providers offer special education programs and support initiatives for children to help them learn about saving and finances. This can be invaluable, particularly if the support is non-commercial in nature and complements the lessons you teach them.

How to find the best kids' bank accounts in Australia

With so many options available when it comes to kids' bank accounts, it can sometimes feel overwhelming making a choice. To help make choosing the right one for your child's needs less tricky and time consuming, you might like to consider utilising RateCity's Real Time Ratings. 

RateCity's Real Time Ratings is a rating system that ranks bank accounts based on their specific features, perks and fees. It analyses bank accounts from over 90 authorised deposit-taking institutions to give each one a score out of five stars.

Real Time Ratings does the hard yards for you, so you have the most current and up-to-date information at your disposal, including any product developments and special offers that may be released.

When making a final decision, consider checking the product disclosure statement before signing on the dotted line. And, for information and advice specific to your personal financial situation, consider reaching out to a financial advisor.

How you can encourage your kids to grow their money

Aside from parents just arranging for the regular transfer of money to be deposited into a child's account, there are several ways you can encourage your child's savings, including the following:

  1. Piggy bank – If they have a piggy bank for loose change or money given to them by family or other sources, this can be emptied every few months and deposited into their account. Some banks and financial institutions will not take random bags of coins over the counter; instead, they will ask you to bag them with their bags, which are designed to take specified denomination amounts and then weight-checked.
  2. Pocket money – If you’re already giving regular money to your children, you could encourage them to deposit some of the funds each week or month into their bank account and watch it accumulate over time. It could also help to prompt them to set savings goals.
  3. Part-time work – Whether they have a part-time or holiday job while still at school, using the bank account to deposit their hard-earned money will give them, and you, a sense of satisfaction. Rather than having cash in their hand, if it’s locked away into an account, it’s a little harder to spend. It will also allow them to practise their savings habits.

Other considerations for kids and money

If you’re looking to establish a kids’ bank account, there are a range of common-sense tips parents should be conscious of in relation to influencing a child’s attitude towards money and educating them on the value of money.

You are their first role model –  How you treat money will consciously or sub-consciously impact how they treat it as well. If you’re generally disciplined with your own money, you’re getting them off to a great start as a young saver.

Income and expenses – Keeping money lessons simple by talking about the two sides to the financial ledger allows children to visualise the need to have balance with what they earn and what things cost.

Needs and wants – This is a critical element of spending that will carry a child well into adulthood and allow them to prioritise whether they need something or whether they just want something. It’s a simple but effective question to ask them early in life, so they realise they cannot have it all.

Pocket money – There are so many different approaches around what age is best to start an allowance, how much should be given (if at all) and what tasks should be attached to children being given pocket money. However, it all comes down to individual families and how you align it with your specific values and lifestyle.

Credit – Once children reach their teenage years, the concept of credit and how it works should be particularly understood so they are aware of its role.

Online research – Encourage teenage children to carry out their own research online for any significant items they may be considering purchasing, so they can start to understand the financial value of comparing the range of offers from different providers. By shopping around, they will understand the savings that can be made on popular items such as phone plans, electronics, sports merchandise and fashion. These savvy dollar-saving habits will serve them well when they’re responsible for independently managing their own finances.

Frequently asked questions

Can I open bank accounts for my children?

A common question for new parents is, ‘Can I open a bank account for my child?’

The short answer is yes – as a parent you can open a bank account for your child.

Once you’ve compared your options and found a bank account that suits your needs, the process is relatively simple.

As the bank account is for your child, you’ll need to provide some documentation such as proof of ID, including your tax file number.

You will also need a copy of your child’s birth certificate, and in some cases you may also need to sign a guarantee of indemnity.

Depending on the bank and whether you’re an existing customer, you may be able to open a bank account for your child online. However, you may still need to go into a branch to prove your identity.

How do I open a bank account for a child?

There are few better ways for a child to learn about money management than through savings. And there’s a plethora of bank accounts designed specifically for young people and children.

A bank account for a child can be opened online, over the phone or in a branch in a few easy steps. The minimum age a child can open a bank account for themselves usually ranges between 12 and 14.

If the child is too young to open the account, you can do it for them as their legal parent or guardian. 

To do this, you would need to be over 18, have an Australian residential address and currently reside in Australia (or have proof of residency).

You would also need to provide:

  • Identification for yourself and the child
  • Your tax file number (TFN) or TFN exemption

Depending on the bank account, you might be able to choose what level of access the child has to their bank account (online and via the phone).

Can you open another account at the same bank?

Yes, you can open another account at the same bank if you already have an account there, but some banks place a limit on how many specific accounts you can open.

Generally, though, it is possible to have more than one everyday account, one personal account and one joint account, or have different types of accounts – such as a transaction account and a savings account.

Keep in mind that some bank accounts come with fees, so you could be charged twice for having two types of the same account at the same bank.

Also, if you have more than one high-interest transaction account at the same bank, only one account will be able to earn the highest rate of interest.

How do I close a bank account?

Closing a bank account is one of those tasks that’s easy to put in the too-hard basket. There are quite a few steps involved, some which may require you to hang on the phone for a while.  

Here’s a handy checklist of items to tick off, so the job gets done quicker. If you don’t do your banking online, the following steps can also be done at a branch.   

  • Cancel any scheduled or recurring payments
  • Update your direct debit details (such as loan repayments) with creditors
  • Export your payee address book (to keep a record of saved third-party bank account details)
  • Transfer the balance of your account (to the new bank account)
  • Close your account online, or by calling the bank or visiting a branch

How to transfer money to another bank account

Transferring money to another bank is often called a bank transfer, and it can be done a few different ways.

Customers generally need three pieces of information to transfer money to another bank account. Customers need the account name, BSB and account number of the account they wish to transfer money to.

One way of transferring money to another bank account is in a branch with the help of a staff member; they will often give you a receipt as well as confirmation of the transfer.

Transfers can be also made via internet banking and phone banking.

Some banks also allow customers to make transfers via partnered ATMs, especially if the account is with the same bank.

Can you deposit money into somebody else's bank account?

One of the easiest banking tasks in the world is depositing money. You can even deposit money into someone else’s bank account if you wish.

The basic information you need to deposit money into a third-party bank account is:

  • Payee’s name
  • Bank, building society or credit union (though this isn’t necessary)
  • BSB (or bank code, which is the branch identifier)
  • Account number

Including the name of the financial institution isn’t necessary – particularly with online banking – because the BSB will identify this for you.

A handy tip is to record yourself (or add a personal message) in the transaction description or reference. This will show up on the recipients account, letting them know who’s paid them the money.

Can I have a PayPal account without a bank account?

You don’t need a bank account to send or receive money through PayPal. However, you do need a bank account if you want to withdraw money from your PayPal account.

Can you find your bank account number online?

If your bank offers online services, you should be able to find your bank account number online by logging into your account on your bank’s website and checking your details there.

Keep in mind that each type of account you have with a bank comes with a unique account number. This means if you have a bank account as well as a savings account, for example, your bank account number and your savings account number will be different.

If you don’t have access to your bank account online or can’t login, you should be able to find your account number on a mailed bank statement, if you have one.

Alternatively, you can call your bank’s customer service number or visit a branch to retrieve your account number.

Can I close my bank account over the phone?

In most cases, you can close a personal or business bank account over the phone. In fact, this is the best way to ensure you’ve closed an account properly.

By speaking to a banking representative, you can capture and close out any pending transactions, or interest owing/payable on the account being closed.

In the instance where the account is a joint account, or you have multiple bank accounts you want to close, your bank may send you a form that you need to fill out and return.

Either way, you would be advised over the phone of the steps you need to take. Calling your bank ahead of closing an account is often a smart course of action.

Can foreigners open bank account in Australia?

If you’re migrating, studying or working in Australia, you’ll be pleased to know that you can open an Australian bank account. For the most part, opening a bank account in Australia is a simple process which starts by comparing the types of bank accounts foreigners can open in Australia.

Once you’ve found a bank account that suits your needs, you can start the application process.

When you apply for the account, you’ll need to provide proof of ID which may include your passport, overseas ID or credit card. You may also need to provide a copy of your visa and proof of address in Australia.

Depending on the bank and the type of account you choose, you may be able to apply for the account online or over the phone before you arrive in Australia.

How do you set up a bank account online?

Once you’ve compared bank accounts and found the right one, the process of opening a bank account online is quite simple and can be done in around 10 minutes.

To set up a bank account online, you’ll need to prove your identity and provide an approved form of ID as well as your tax file number (TFN).

If you’re a new customer of the bank, you’ll need to verify your identity and potentially upload documents before you can complete your online application.

Once your ID has been verified and you’ve set up your bank account online, you should receive your bank cards in the mail along with your PIN and any other account details.

How do I open a new bank account?

There are a number of ways to open a new bank account – online, over the phone or in the branch. The trick is to decide what type of bank account you want beforehand.

It might sound like a simple enough task, but there are literally hundreds of bank accounts to choose from. And each offer their own banking features and benefits.

A comparison site like RateCity can help you work out what bank account product matches your needs.

Once you’ve made up your mind what you want, it’s advisable to have the following information ready for the application process.

  • A couple of forms of identification (such as driver’s licence, Medicare card, passport)
  • Tax file number
  • Residential address, contact phone number and email (though email is not essential)

How can I wire money to a bank account?

You can wire money to an Australian bank account either through your own bank or by using a money transfer company such as Western Union or MoneyGram. Either way, you’ll need the other person’s name, BSB number and account number. If you use a money transfer company, you might also need to provide the recipient’s address for large payments.

How do you open a bank account in Australia?

Opening a bank account in Australia is usually a straightforward process. Some banks give you the option of opening an account online, while others require you to visit a branch.

Different bank accounts offer different features, so it’s best to compare your options to find one that suits you.

All banks require you to pass an identity check to open a bank account. Australia uses the 100-point identification system, which means you’ll need to show a number of forms of ID that, together, add up to 100 points.

Common ID types include a driver’s licence, passport, Australian visa in a foreign passport, and Australian Medicare card. You’ll find out what types of ID are accepted when you go through the sign-up process online or at a branch.

Once your account is open, you’ll be given or sent a debit card that you can use to make purchases and withdraw money from your account.

What do you need to open bank accounts?

Opening a bank account is one of the simplest online tasks you could perform. The hard part is deciding which type of bank account you want to open.

All banking institutions have a website where you hit ‘apply’ on the account of your choice and step through an application in less than 10 minutes.

Here’s a list of information that is generally required for applications.

  • Identification (driver’s licence, passport, proof of age card, proof of citizenship and/or birth certificate)
  • Tax file number (so you don’t get charged the highest tax rate)
  • Address, contact email and phone number

If you decide to open a new account at the branch, make sure you ask beforehand what information you need to take with you, or take all of the above to be safe.

Can I open a bank account in another country?

Despite having a bad rap for facilitating tax evasion, it is possible and legal to open a bank account in another country, also known as an ‘offshore account’.

Some people choose to open a bank account in another country to invest overseas, for higher interest-earning potential or to access foreign banking services.

The process for opening an offshore bank account differs depending on the financial institution and country in which you’re opening the account.

Typically, you will need to provide identification such as a passport, a local bank statement and a signed declaration proving the source of the money being used to open your account. Usually, deposits into offshore accounts can be made by international money transfer.

Can British expats still open bank accounts?

As a British expat, you can open an Australian bank account, and you can apply for an account the same ways an Aussie would. You can even open an account online from the UK prior to relocating.

If you’re overseas, the bank you choose to open an account with may call you to provide you with our new account details beforehand. You can then have your ID verified within a branch once you’ve arrived.

And if you’re already living down under, the following list outlines the types of information required by most banks when opening an Australian bank account.

  • Australian residential address
  • Tax file number (TFN) or a TFN exemption
  • Identification (this can be your passport)

Can I find my bank account number online?

Yes, you can find your bank account number by logging into your online banking and clicking on the relevant account.

How do you transfer money from PayPal to a bank account?

Transferring money from PayPal to an Australian bank account is simple. Just follow these three steps:

  • Go to your Wallet
  • Click ‘Transfer Money’
  • Follow the instructions

The money will take three to seven business days to reach your bank account.

Once you’ve made the transfer request, it can’t be withdrawn.

How can I close a Commonwealth Bank account?

You can close your Commonwealth Bank account at any branch, provided you have appropriate identification. You can also close your account over the phone, by calling 132 221, 24 hours a day.