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Hi there! Has anyone done any investigations into which bank account is the best as a saver account for your child? We'd like to start one up for Riley but after checking with a few banks we're totally confused as to which would be best...maybe some of you have had some success with finding the 'right' one? Any help would be appreciated! Thanks! :)
We decided to go with a managed fund instead, because the banks pay diddly squat interest on their savings accounts. Plus it was a better option for us as we wanted something in the long term that we couldn't access. When each child turns 18 they will get a payout from it. We started it 4 years ago now and it has earnt over $1000 in that time and we only started it with $1800. So $250 a year is way better than any bank. We have the option of adding money to it as often as we want, bu so far we haven't been able to contribute any, so the $1000 was earnt on the initial $1800 alone. What we do in the mean time is put $5 or so in the kids piggy banks at home and then when it gets to $500 we will transfer it to the fund, which can only have increments of $500 go into it. The fund is with AMP, and we saw Warrick Luff for it, who is in Wagga in the D'Hudson arcade. He is a great guy, and it costs nothing to see him for advice anyway. HTH Sherie
It will depend on how much you have available, as to whether you can start up a Managed Fund, as most of them have a minimum amount that can be invested. Like Sherie said, they can be a great thing though as they have the ability to diversify the money across a number of asset classes (depending on what type of fund you invest in and there are hundreds available), as opposed to bank accounts where your money is simply invested in cash/fixed interest. Managed Funds give you access to shares and property, without you having to do it directly.
Before you launch into the world of managed funds, or indeed any kind of investment, you should definitely seek advice so that you are going in to something entirely suitable for your circumstances (you may want something that is on call rather than locked away for example), and are well advised as to the fees. Managed Funds incurr costs (management fees) and there may be a charge to go into the fund (an initial brokerage fee) as well as ongoing fees, and perhaps a fee to see someone about these kinds of things.
There are a number of fairly simple bank accounts out there that are pretty good however, and you should be able to find one that suits your needs. We have accounts set up for both Jacob and Ruby and they are National i-saver Accounts. They earn a higher rate of interest than their normal accounts, but we don't have ATM access or anything like that (which we don't want or need anyway). We deposit money via internet banking and can do the same to withdraw if we like (i.e. transfer funds to another account that has ATM or cheque book access and withdraw that way). We have never withdrawn money though.
We have ING saver accounts for the girls, mainly because there are no fees & until there is enough money to get a managed fund we will keep it in there. I like it because we can transfer money in via the computer and never have to look at it again. We get given money for the girls for birthdays from oversea's relatives and rather than buy gifts for them, we will pop them into the accounts so the girls will be able to buy things when they get older.
Sherie - I went into St. George to open a Little Dragons account for Gabby (the equivalent to the Commonwealth's kids account that Vic schools use for banking). However the bank teller recommended I get a Power Saver account (kind of like one of those ING accounts that are on TV?). It pays a higher interest rate than the kiddy accounts. She said that the kid's accounts are good for older children that might make a few withdrawals. Since Gabby's account will hopefully be untouched until she is 18-21, she suggested something like the power saver with a high interest rate. It costs something like $5 to make a withdrawal but that's ok because we're not going to withdraw money. Atm she only has about $150 in there but as it gets larger I might investigate something a little more secure? Until then it's hooked up to our internet banking so I can deposit money easy as.
Wow, thanks girls!
We won't have much to invest (only about $150 plus maybe $5 a week/month or something for a start) so I think a bank account of some sort is the way to go for now. I like the idea of the St George account, we definitely won't be making any withdrawals and there won't be much money for a while... Hopefully we can look into it a bit more next week. :)
Thanks again!
HI, we want to open one, but i went to Bank Of melbourne(westpac) and was told the acct has to be in our names , not DS.. is is possible that any banks open up acct in DS name not ours?
I think most banks have kids savings plans. We'll probably go with the Credit Union as their fees are cheaper.
My kids have Teachers Credit Union accts as I am with them. They even get a card on their birthday and the statement comes addressed to them which Erin loves. They also have Commonwealth dollarmite accts only as they can bank at school, (Erin can put the others in as well as her own) and the school gets money so its helping with school fundraising.
That's a great idea, getting a bank account started for the kids are people keeping it as a present for 18-20yrs old or is it something that they know about?
Our kids are too little to understand, so they don't really know about it, but I guess as they get older we will tell them. SIL also has a small share porfolio for each of them too, and she has control of that until they are 21. I suppose they could use it for Uni fees or buy a car or to help move out of home (I wish ;) ) if they want.
We'll tell Riley about his account when he's old enough to understand...he can put money in but we won't let him take money out till he's old enough (over 18 I guess). I had something similar when I was a kid and I loved putting money in the account, it was great to see it growing each year and I think it really helped me with my saving as an adult too. :)
We are with Adelaide Bank and just got 2 high interest accounts with the adelaide bank when Lachlan was born one for each of the kids. We still have to organise to set up the 3rd account for Ashton. We deposit $10 a fortnight into each account. After 2.5yrs they have just over $750.00 in them not a great deal but by they time they get it at 25 (yes we plan not to give it to them until they turn 25 ) there will be be quite a bit in there.
Need to get to bank and do Ashtons as we already have a $50.00 we receieved when he was born to go in and he is 2.5mths old already LOL
not sure if we will tell the kids or not at this stage. But they do get statements sent addressed to them LOL
Love
we're still looking at setting up the Commonwealth Education Fund for Jordy
They have four plans, but a minimum $1000 opening I think. Jen's parents gave him $1K when he was born... It is tax free as long as any withdrawals are for educational expenses
Bank accounts are such a great idea. My best friend at high school had one set up for her. By the time she was 18, she had enough money to buy her first car. I was SOOOOO jealous! It wasn't the most fancy car but, when you're 18, any car will do!! LOL
I'm hoping that Gabby will be able to use her money for a car or to cover education expenses. We're not sure yet. Either way it's a great investment into their future :)
We had accounts set up for us when we were kids but the money was used when Mum and Dad divorced :( Gotta love that!
we use a dollamite account at the CBA - but that's only because DH works for the CBA and it was easy to open!! they get a cool statement that's easy to read and will be good for when he's older, it's one you can add to - we are doing the same thing as others - $10 a fortnight to be given to him when he's 18 or 21 - plus great grandparents gave him some money so it's looking pretty healthy at the moment.
DH wanted to put $50 a fortnight into it - I had to remind him if we have another bub he'll have to do the same for them and it could end up quite an expensive venture - especially considering they will probably p*ss it up against the wall when they get it!!!
Wow I think I will look into pulling Kaitlyns money out of the Commbank and starting a managed fund account!