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Best bank accounts for children 11 and over: our guide to the top payers

best bank accounts over 11Bank accounts for 11 year olds? Whatever next? Scarily it is possible for your tweenager to have a fully functioning debit card of their own at such a tender age. Some parents will worry that this kind of access to cash means going overboard on in-game purchases. The flip side of the argument is that it’s never too early to learn about managing money and besides, where are the kids going to park all their Christmas cash?

There’s quite a selection on offer. In fact, there are 17 current accounts for kids, says researcher Defaqto. They have all been designed with our tech-native offspring in mind so most have a contactless debt card and an Apple, Samsung or Google pay function. All of the accounts can be operated digitally either online or via a smartphone. Overspending, unlike grown-up accounts, is impossible as under-18s cannot be offered overdrafts. There are restrictions as well on the amount of money that can be withdrawn from an ATM in one go, from between £100 per withdrawal to £500.

The mini-Minteds have both had current accounts with Lloyds since the age of 11. When I opened the accounts, the interest rate was a whacking 3%. Typically it has now dropped 0.5% which has really annoyed me. We should look to move to a better-paying accounts but the hassle factor is immense, especially as the kids are now used to remembering a certain password and perhaps wouldn’t be keen to learn a different system. They don’t have much money in the accounts anyway – it’s all getting spent on clothes and games. For me, the financial education they’re getting in running their own budgets outweighs the measly rate.

I’ve sifted the Defaqto data and pulled out the top-paying accounts for a minimum age of 11 with at least £1 to deposit. Way ahead of the rest is TSB Under 19s account which pays 2.5%. Joint second are Nationwide FlexOne and NatWest Adapt which both pay 1%. Royal Bank of Scotland’s Revolve is next on 0.55% while Lloyds, Halifax and Bank of Scotland trail with accounts paying 0.5%.

Hold that cheque book though! The top children’s account overall puts these in the shade. It’s Santander’s 123 Mini account which pays a heady 3%. If you’re over 13, no problem, you can open it in your own name. For under-13s, an adult already with a Santander account must open it in their name for the child initially.

It’s also worth saying that TSB has suffered technology problems this year although these should now be resolved. And when selecting an account, you should consider a bank with a branch close to you: you’ll need a face-to-face meeting with your child at the bank to set up the account.

See here for our SMM guide on savings accounts for children. 

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Sunday, 21 April 2019