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Looking for savings accounts for children

Banks have long offered "child only" bank accounts, however the face of them has changed over recent times. Gone is the focus on the free toy or money box your child received as a thank you for opening an account to be replaced with more emphasis on interest rates. In the past savings accounts for children had relatively low interest, after all children could not work so how much money could they possibly have to stick in to an account. As time progressed banks realised that children do have access to money and that if they put all this cash in to an account with a good interest rate, they could have reasonably healthy savings by the time they reach adulthood.

Interest rates on savings accounts for children have vastly improved in the last few years, so it is worth your time shopping around or visiting a comparison site to get the best deal. Always read the small print before opening an account. Some children's accounts may have withdrawal or deposit limitations and others may offer low interest with an annual bonus. These annual bonuses are not always all they are cracked up to be, as they are often on the understanding you will deposit a certain amount of money over the 12-months. It is best to look for an account with a good interest rate and no strings attached.

The Halifax Children's Saver account offers a 6% APR with a minimum initial deposit of ten pounds. There are no deposit restrictions, however notice on withdrawal is expected and the interest rate could drop to 3.6% APR if the withdrawals are made on a regular basis. This account is perfect for building a little nest egg for your child by putting a small amount away each month and letting it grow. The Yorkshire Bank has several savings accounts for children, with the best one having a fixed interest rate of 4.25% APR for 12-months. After this time it is moved to another account with an interest rate of around 3% APR. The minimum initial deposit for this account is slightly higher though, at around £50.

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