The best tool to teach kids about money: current accounts

The best way to teach kids about money

If you are keen for your children to get used to managing money, you should encourage them to open their own current account.

Most providers offer kids bank accounts to those aged 11 up to 18 and they generally work like adult ones; you can pay money in and make withdrawals from an ATM or in a branch.

The main difference is that children's bank accounts don't offer overdrafts, so there' no way your child can accidentally or intentionally spend more than is in the account and be hit with fees.

You'll also find that these accounts will offer the choice between a cash card, which allows ATM withdrawals or a debit card which can be used in shops, online and at ATMs. Most banks will let you control which your child gets.

You should also bear in mind that you will normally have to accompany your child to open a bank account in branch or do it on their behalf if they are under 16.

Without further ado, here's a roundup of the best current accounts for children.

Santander 123 Mini (11-18)

The Santander 123 Mini current account is available to kids aged 11-18.

It pays tiered rates of interest. Your child will earn 1% on balances from £100, 2% on balances from £200 and 3% on balances from £300 to £2,000. Interest is calculated daily but paid monthly.

The account comes with the choice of a cash card, which limits them to taking money out of ATMs, or a Visa contactless debit card, which also allows them to shop online and in stores.

The maximum that can be withdrawn each day on either is £300.

Those that are 16 or over can take advantage of Retailer Offers, which is a scheme that allows you to earn cashback when shopping online or in stores with a Santander Visa debit card.

Kids can keep track of their money through text and email alerts, over the phone, online, through mobile banking or via a branch.

Only one account per child can be held. You can open an account online (ID must be provided in the post) or by going to a local branch.

TSB Under 19s (11-18)

The TSB Under 19s account can be opened by 11- to 18-year olds.

It pays an attractive 2.5% rate of interest every three months on balances up to £2,500, while balances over £2,500 will earn 0.1%.

On top of that, once your child turns 17 they'll also get driving discounts. They could save £36 on AA driving lessons and receive a free Pass Your Test CD worth £19.99. They'll also get a further £20 off a Pass Plus course, which teaches advanced driving skills.

The account comes with a Visa debit card to use in shops, online or at cash machines or a cash card that just lets you take out money from cash machines.

The maximum daily withdrawal limit is £300 on either. Those aged 13 years or over can also use Apple Pay or Android Pay if they go for the Visa option.

The account also comes with the Save the Change feature. Each time your child purchases something with their Visa card, the amount is rounded up to the nearest pound and transferred into a TSB savings account.

Kids can manage their account in branch, as well as online (16 years or over), over the phone (16 years and over) and through the mobile app (13 years and over).

Accounts can only be opened in branch.

To open an account those aged between 11 and 15 must be accompanied by a parent or guardian. You will need to bring two forms of ID like a passport or birth certificate for the child as well as proof of the parent or guardian's identity and address.

Those over 16 do not need to be accompanied by a parent or guardian but will have to bring two forms of ID and proof of their address.

Lloyds Bank Under 19s (11-18)

The Lloyds Bank Under 19s account is open to children aged 11-18.

It pays 1.5% interest on balances up to £2,500. Interest is paid quarterly directly into the account.

The account comes with the choice of a cash card, allowing kids to take out money from cash machines or a Visa debit card which allows them to pay for things in shops or online and use it to withdraw money from cash machines. The limit on daily cash withdrawals is £500.

For 17-year olds, there's the chance to save £75.99 with the AA Driving School. They can get £36 off AA driving lessons and will receive a free Pass Your Test CD-Rom worth £19.99. After passing the test they can get £20 off the Pass Plus course which teaches inexperienced drivers further advanced practical skills.

The account also comes with the Save the Change feature. Each time your child purchases something with their Visa card, the amount is rounded up to the nearest pound and transferred into a Lloyds Bank savings account.

Kids can manage their money through text alerts, online, through the mobile banking app, over the phone and in a branch.

The method for opening an account will depend on the age of your child.

11-12-year-olds must have a parent or guardian to apply for the account and it must be done in a branch.

13-15-year-olds also must have a parent or guardian to help them open the account, but they can do this online or in any Lloyds branch.

16-18-year-olds don't need to have a parent or guardian with them to open an account. They can open an account online or in any branch with the appropriate ID and proof of address.

Halifax Expresscash (11-17)

The Halifax Expresscash account is tailored for children aged 11 to 17.

It offers 1.5% unlimited credit interest and the account comes with a Visa debit card which has a maximum withdrawal limit of £500 a day.

Your child can manage the account online, through the mobile banking app, in a branch or over the telephone.

The method of opening an account will depend on the age of your child.

Kids aged 11 to 12 need to be with a parent or guardian and it can only be opened in a branch.

Those aged between 13 and 15 can apply online or in a branch with a parent or guardian.

You will need proof of ID for the child as well as proof of ID and address as the parent or guardian.

For those aged between 16 and 17, the account can be opened online or in branch and there's no need for a parent or guardian to be involved, but they will have to provide proof of ID and address.

Nationwide FlexOne (11-17)

The Nationwide FlexOne account is available to 11- to 17- year olds.

The account pays 1% monthly interest on balances up to £1,000, which isn't as much as the other accounts we've looked at so far.

It offers the choice of a cash card or a contactless Visa debit card. Both have a maximum daily withdrawal limit of £300. The Visa card also lets you make payments using Apple Pay, Android Pay and Samsung Pay.

The account also gives children access to the exclusive FlexOne Regular Saver, which currently pays 3.5% and allows kids to save up to £100 each month.

The account can be managed through text alerts, online, through the mobile banking app as well as in branches.

Again, the method of opening an account will depend on the age of your child.

11-13-year-olds will need to go into a branch with a parent or guardian. The child will need a valid ID as well as a proof of address. The adult will need to bring something with their name on like a credit or debit card or household bill.

14-15-year-olds can apply online or in a branch with a parent or guardian. You will need to go into a branch to show proof of ID and proof of address, while your parent or guardian will need to show something with their name on as above.

While 16-17-year-olds can apply online or in a branch but don't need to have an adult to oversee things. However, a visit to the branch will probably be required to show proof of ID and address.

NatWest Adapt Bank Account (11-18)

The NatWest Adapt account is available to children aged 11 to 18 years old.

It allows kids to earn 1% interest on any credit balance in the account. The interest is calculated daily and paid monthly.

The account comes with a Visa debit card to use in shops, over the phone or online. It can be personalised with a photo or artwork, though there is a £5 charge for this service. Your child can take out up to £250 a day.

Your child can manage the account through text alerts, online, through the mobile banking app, in a branch or over the phone.

You can open an account online or in a branch. If your child is under 16 you can open an account on their behalf.

NatWest needs to see proof of ID and address documents to open this account, these can be verified online, by post or in a branch.

Barclays BarclayPlus (11-15)

The BarclayPlus account is available to 11- to 15-year olds.

It allows you to earn 0.25% on balances, which isn't as much as some of the other children current accounts around.

The account comes with a cash card or a contactless debit card. Barclays allows you to personalise your card with a photo.

With the cash card, you can withdraw £50 a day from cash machines, while the debit card allows you to shop in store and online and withdraw up to £300 from cash machines.

You will need £1 to open the account, which can be done in a branch.

Your child will need to bring ID which can be a passport or European National Identity Card and proof of address which can be a parent or guardian's household bill or bank statement.

HSBC MyAccount (11-17)

The HSBC MyAccount is a current account for children aged 11 to 17.

It doesn't offer much in the way of perks like interest but you can choose to combine it with a MySavings account, which is open to 7- to 17-year olds and pays a rate of 2.75% on balances up to £3,000.

The MyAccount comes with a Visa debit card and your child will be able to take up to £100 out a day from an ATM.

The account can be managed online, through the mobile banking app, over the phone and in branches.

To open an account, you will need to print an application form, fill it in and take it to your local branch.

You will need to provide ID and proof of address for the child unless you as the parent or guardian is an existing HSBC customer.

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The army of people who come to our homes to do odd jobs is a new phenomenon for all but the very wealthy. You may well have the skills required to complete these jobs, so get stuck in.

Ditch going out for dinner or browsing round the shops for taking a walk, visiting the beach with a picnic, or holding a family DVD night.

Nowadays we're constantly striving for a bigger TV, a flashier car and a better kitchen. Generations ago people never considered that they would ever be able to afford bigger, flashier and better, so they got on with the business of enjoying what they had.
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