The most simple way to start a savings plan for a child is to use an instant-access savings account. While the rates you can obtain are – in this low interest rate environment – slender, these accounts are very low-risk and can help teach children about saving and interest. A great place to start would be the winner in this category, the Norwich & Peterborough Building Society's Family Young Saver account. It pays 1.75% gross and can be opened with as little as £1. "This account is paying a competitive rate of 1.75% and has been since October 2010 – so is certainly consistent," says Anna Bowes, director of Savingschampion.co.uk, which helped Moneywise judge this year's awards. "Children aged seven or over can open the account themselves – and parents, grandparents and guardians can save on the child's behalf from any age, as a trustee." The account can be opened in branch or by post and, once set up, can be managed online. Another good choice is our runner-up, the highly commended Lloyds/TSB Young Savers Account, which has paid a whopping 3% interest for over three years. Indeed, the account would have been the winner in this category were it not for the fact that in order for a child to open it their parent or guardian also needs to have a Lloyds or TSB current account. "The account is paying a market-leading 3% AER and has been since its launch on 15 August 2011 – so it has remained consistent, even though savings rates have been plummeting," says Bowes. "The balance on which this highly competitive rate is paid is also quite high at £20,000."
Best children's savings account 2015
Winner: Norwich & Peterborough Building Society Family Young Saver Current rate: 1.75% gross/AER Age Range: Under 18 Interest paid: Annually Minimum deposit: £1 Maximum balance: £1 million Access: Easy Access. Open and save in branch, by post. Manage online also. Access your savings with a cash card Contact: 0845 300 2511 nandp.co.ukHighly commended: Lloyds/TSB Young Savers Account
This article was originally published in our sister magazine Moneywise, which ceased publication in August 2020.
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