At Mozo, we’re passionate about getting Australians a better deal on their finances and the Experts Choice Awards provide us with a platform to highlight children’s savings account products in the marketplace that we believe offer great value to Australian consumers. Here are the winning savings accounts taking home Mozo Experts Choice honours in 2017.
Of the 35 children’s savings accounts we compared for this year’s Experts Choice Awards, here are the savings accounts identified with the best unconditional interest rate for children 8 years and over. Criteria for the award also included: no monthly service fee, unlimited free internet transactions, no notice period for withdrawals, no automatic sweep function and to be able to link to accounts at any institution.
If your child can make regular deposits of their pocket money, a savings account with an ongoing bonus rate could be the best interest earner. We reviewed all kids bonus rate savings accounts in our database and here’s the winners list for 2017. For full awards criteria see here.
Mozo considered at call savings accounts, transaction focused bank accounts, and fixed term deposits. Awards have been awarded for each of these product types.
Mozo has been researching and comparing financial products since 2008, and hundreds of thousands of Australians use our comparison services each month. Our research team is headed by our Research & Insights Director and our Product Data Manager who have over 50 years of financial services experience and 22 years in online financial comparison.
More information on the methodology and deposit awards criteria can be found here
Kickstarting your kid’s savings account
The 2017 winners of the Mozo Experts Choice Children’s savings account awards have met our money expert’s criteria for excellent value, but are there other things you need to consider when choosing a savings account for your child? Here’s some of our top tips:
Choose your account based on savings frequency. In many ways a kids savings account is much the same as a regular personal savings account, so the best accounts are the ones which give you the most interest possible for your savings habits. If your child is only able to make deposits at set times of the year, like after their birthday or Christmas, they should opt for a standard account that doesn’t have conditions attached. If they can save regularly, just be sure you’re aware of any requirements you’ll need to meet any special rate - for example, minimum deposit requirements or penalties for withdrawals.
Make savings fun with online tools and resources. Perhaps the most important part of opening a children’s saving account for your child is to provide them with the basic financial skills they’ll rely on later in life. That’s where some banks can really help out. Many providers have educational tools and material such as savings calculators, budget calculators, games and child friendly websites to help your children along the way.
Tax implications. Changes in law mean that there are no longer tax offsets for interest earned in a children’s saving account. Any interest earned in the account over $416 will be taxed as earnings.
And also look out for:
Fees. While many banks will waive account fees for young savers, some accounts charge for over the counter withdrawals or purchases using EFTPOS.
Maximum balances. Some children’s savings accounts can come with maximum account balances whereby the portion of the balance above the maximum will only earn the base interest rate (which could be significantly lower).
Age limits. There’s no standard maximum age limit across different banking providers and accounts. Depending on the account, age limits can range from 12 to 18 years. So make sure you’re aware of any age restrictions because once the child reaches the age limit they will be rolled over to a new account which could possibly have a much lower interest rate.