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Children’s Bank Accounts

Last updated: 23 September 2016

One of the easiest ways to save is through a high street bank account; many people still like to have one of these for their children. Unlike junior ISAs or child trust funds, you are not committing to locking money away for your child until they are 18.

Although interest rates are currently very poor, some children’s accounts offer attractive interest rates, but these vary depending on just how much access you will want to the money and how often.

Halifax, for example, offers a whopping 6%, as long as you save between £10 – £100 a month and do not withdraw it for one year, otherwise you can expect to earn only 3% interest from a Halifax account that lets you draw money out any time.

Mummy Money Matters has researched the market and the table below lists some of best options that offer some of the highest interest rates on the high street available to you.

Account Name


Rate AER

Min/Max Age
Kids regular Saver
£10 – £100 a month
0-15 years
Visit Site
123 Mini
1 – 3%
0-18 years
Visit Site
Young Saver
0-15 years
Visit Site
Chelsea Building Society
Ready Steady Save
£1 -£20,000
0-15 years
Visit Site
Skipton Building Society
Leap issue 2
Visit Site
Children’s Regular Saver
0-16 years
Visit Site
Lloyds TSB
Young saver (requires adult to have an account too)
0-15 years
Visit Site
Chorley Building Society
Young Chorleian
£5 – £350,000
0-21 years
Visit Site
Smart Limited Access
Visit Site



What you should know:

Keeping it tax free

Make sure you fill out an R85 form to ensure your  children’s savings are tax free. Hand it in to the bank when you open an account.

The R85 stays in place until 5 April following your child’s 16th birthday, after which, your bank or building society will ask you to fill out another one to ensure tax is not deducted off the interest.

A fresh R85 form can be completed at any time in the tax year – which runs from 6 April one year to 5 April the next – when your child turns 16, as long as your child does not expect to have any income after that date.

The account must also be transferred to your child’s name when they reach age 16, otherwise your bank or building society will start applying tax.



When opening your account, check that the bank is covered by the Financial Services Compensation Scheme (FSCS). Most banks and building societies will be covered, but it’s always best to check the small print.

The FSCS can pay you compensation should your bank or building society go bust.

Most individuals and small businesses are covered, but the compensation is limited to £85,000 – which means, if you have more than £85,000 with one bank in total, you will not be compensated for anything above £85,000.


Special tax rules

You should also beware of the special rules in place with HM Revenue & Customs, which collects taxes for the government, regarding savings given as gifts to their children by parents.

If savings given by the parent produce more than £100 of interest in one year, the whole amount will be taxed as though it were the parent’s income. This “£100 rule” does not apply to gifts given by other relatives and friends.

The rule applies to each parent or step parent separately.

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Reduce your grocery bill by 70% this summer!

The kids are off school and they are going to be hungry – inevitably, the next few weeks will see the cost of your weekly shop shoot up.

To help families keep the costs of food shopping down, MMM put Approved Food to the test, which can help slash the cost of shopping by as much as 70%.

There is of course one catch – the food is past or close to its sell-by date, but perfectly safe.

With a £30 budget, MMM managed to bag a fair amount – cereals, tinned food, sweets and treats, drinks and even laundry detergent and dishwasher tablets – the sort of things where you can generally ignore the date stamped on the product.

If you’ve tried reducing the cost of the grub by switching brands or shopping at discount stores but think you can do better, then try Approved Food  – you’ll be surprised at just how much you could save on some store cupboard essentials.

New products are available everyday and there are some real bargains. For example, Sprite Zero 330ml for just 29p or a 2kg Reeses Peanut jar for just £2.99. There’s even stuff for pets, at more than 50% off.

MMM was really pleased with service and surprised at just how at just how much £30 would buy (see pic above/ instagram).

Although we would like to see Approved Food cut down on the cardboard packaging, the items arrived well packed and in excellent condition.

So, if you’re looking to save a few more pounds on your groceries, take a look at Approved food – you’ll be surprised at just how good the bargains are.


Keep up with MMM on Twitter @MumMoneyMatters and Facebook !


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