What Is the Best Bank for Kids?

Updated on August 24, 2018
VirginiaLynne profile image

VirginiaLynne is a mother of five. She writes about parenting, crafts and games for children, family fun, and Christian ministry ideas.

What Is the Best Bank for Kids and Teens?

As the oldest of my five kids became teenagers, I knew we needed to find a better way for them to save money than to keep it in a stash in their rooms. We had savings accounts for kids at our bank, but those required making a trip to the bank to get money out or put it in, so we never really used them. The fact is, I had become my kids' bank, and I wanted to give up the job.

What was I looking for? I wanted an account that would:

  • not charge a fee, even if they didn't have much money in the account.
  • let me transfer money in and out of the account easily online.
  • allow my kids to see how much money was in the account and keep track of their spending.
  • encourage them to save their money by giving them interest.
  • give them a debit card so they could make purchases when I wasn't with them and practice handling transactions on their own.

As the oldest of my five kids became teenagers, I knew we needed to find a better way for them to save money.
As the oldest of my five kids became teenagers, I knew we needed to find a better way for them to save money. | Source

How Much Do You Know About Kids and Money?

view quiz statistics

Our Solution

After looking into some local bank programs and finding they did not meet our needs, I got an offer from my online bank, Capital One 360, about their Kids Savings Accounts and Teen MONEY Checking Accounts. I signed up all of my kids for both accounts over eight years ago and have never looked for another bank since. I recommend these accounts to my friends because Kids Savings and Teen MONEY accounts:

  • are easy for kids to understand and use.
  • allow teens to practice using a checking account, savings, debit card and checks.
  • are linked to my account so that I can monitor their spending and also transfer money.
  • allow quick online uploading of checks using a phone or computer.
  • give a debit card for teens to use (Teen MONEY).
  • allow 18-year-olds to easily transfer to a personal adult account, but also keep a joint account with their parents (which has made it very easy for me to give them money while in college).
  • allow kids to have both a checking account and a savings account.
  • Allow a young adult to move toward an adult banking account when they are ready (as my oldest just did when she graduated college!).

Having both a savings and a checking account helps teach kids how to use their money wisely. Just like in adult accounts, the savings account earns a bit more interest so they have an incentive to save rather than spend, and the checking account gives them a debit card so that they don't always have to carry cash. The checking account has an account and router number teens can use to sign up for direct deposits from a job, and they can order paper checks for $5.00 if they need them.

Is Capital 360 Banking Safe for Kids?

One way to teach your kids about using their money wisely is to help them understand what makes a bank safe. We looked at the Capital 360 website to find out about how safe this bank would be. Here is what we found:

  • Capital 360 is an online bank that started in 2000 and is headquartered in Delaware.
  • Bankrate gives them a "5 Star Safe & Sound" rating.
  • It is a federally charted bank insured by the FDIC, with deposits insured up to $250,00 per person.
  • The website offers financial education information to help customers understand banking.
  • Parents have control of adding deposits or transferring money online, but kids under 18 can only view their accounts online and need to use their debit card or checks for payment.
  • Debit cards can be locked and unlocked on the mobile app or online if they are lost or stolen.

As they became teens, I wanted to teach my kids how to handle money and encourage them to save.
As they became teens, I wanted to teach my kids how to handle money and encourage them to save. | Source

Bank for Kids Poll

Where do your kids currently keep their money?

See results

Why Online Banking Helped Our Family

Looking at the website, I realized that this banking plan was designed to teach kids to save money and to help them learn about interest. I've especially liked the fact that by having an account where they can track the money they have has encouraged my kids to save the money they've gotten from their grandparents or earned from babysitting.

When we had traditional banking accounts, they always seemed reluctant to give me their money because it seemed to "disappear." I hated to have them keep cash or checks in their rooms because I was always worried it would get misplaced. Moreover, before it seemed my children always felt they needed to spend all of the money they received. Now that they can use the app to see their accounts, they are much more inclined to save rather than spend.

What do You Need to Open a Kid's Savings Account?

Parents will need to have their own bank account in order to open an account for their child. Additionally, opening an account requires:

  • opening up a Capital One 360 checking account for the parent (if you don't already have one).
  • giving personal information about the parent, which includes a Social Security number.
  • providing account and routing numbers of the parent's bank account.
  • verifying the parent's ownership of the checking account by confirming one or two small deposits made into the account by Capital 360.

Benefits of Teen Checking

Teens can save up for bigger purchases.
Teens can save up for bigger purchases. | Source

Facts About Kid's Savings Accounts

  • The accounts earn interest.
  • There are no fees or minimum balances.
  • You can set up savings goals.
  • Parents can link their account to their child's to deposit or transfer money.
  • You can create different accounts for different savings goals.
  • Automatic payments can be made from a parent's account for allowance or other regular earnings.
  • Kids can view their account at any time but only parents can transfer funds.
  • You can't withdraw funds from the account until the link is validated. New accounts can't be withdrawn for 10 banking days.
  • Only 6 transfers can occur each month.
  • Up to 3 personal checking accounts can be linked to one Kids Savings account, which means that parents and grandparents or other relatives can all add or withdraw money easily online.
  • If you have any trouble with the account. You can chat online or call 1-877-514-2265.

MONEY Teen Checking Account

Although it is called a Teen account, there is no age minimum, so I set up one of these for all of my kids at the same time that I set up the savings accounts. My two teenagers at the time (14 and 17) kept track of their own debit card, while I held on to the cards of the 3 younger siblings until they were older.

Features of Teen MONEY Checking Account

  • No fees for setting it up.
  • No minimum balance.
  • Small interest rate which is variable.
  • Mastercard Debit Card with PIN.
  • Access cash from 39,000 free ATM machines.
  • Deposit checks directly using a phone, or transfer money into the account from parent account.
  • Text alerts can be set up to help parents and teens keep track of money.
  • Transactions can be viewed by parents and teens.
  • The account can receive direct deposits from a teen's job.
  • No foreign transaction fees if students are traveling outside the country (I know this because both of my kids took trips abroad and used this debit card for transactions and cash).

What Can Teens Do on MONEY Accounts?

  • See balance and transactions.
  • Change the nickname, PIN, personal information and "Saver ID."
  • Set up and receive text and email alerts about account activity.
  • Use the debit Mastercard for purchases or getting money from ATM machines.
  • Deposit checks using their phone or computer, and set up direct deposit.
  • Look at and download account history and statements.

What Can Adults Do on MONEY Accounts?

  • Everything the teen can do.
  • Use Automatic Savings plan to transfer money to account systematically.
  • Use personal finance software like Quicken, Money, or CSV to download transactions on this account.

Signing Up Facts

Teen MONEY Accounts operate similarly to the Kids Savings Account, but some differences are that:

  • The adult sponsor does not have to be the teen's parent, but must be over 18.
  • The adult sponsor must have a Capital 360 account.
  • Both the teen and the adult must be U.S. citizens or permanent residents with a Social Security number.

Other Kids Banking Tips?

Capital 360 has been an excellent bank for us. My kids also liked the fact that they got an extra $20 in their account when I responded to a special offer.

Once my oldest daughter turned 18, I got a notice that the bank would work with us to turn the account over to her. That process took a while but went smoothly for both my oldest daughter and then my son. While they were in college, these accounts made it easy for me to transfer funds to them when necessary.

When my daughter went out of state for graduate school this year, she closed our joint account and is now banking on her own. We feel that using the Capital 360 accounts prepared her for handling her finances and making responsible banking decisions.

If you know a tip for helping kids learn about banking, please leave a comment below!

Questions & Answers

    Comments

      0 of 8192 characters used
      Post Comment

      • VirginiaLynne profile imageAUTHOR

        Virginia Kearney 

        6 years ago from United States

        You are right about changes toknowinfo! Actually, ING just added a feature that lets you use an app to deposit checks by taking pictures with your phone or iPad. That will be great for us. I haven't tried it out yet, but plan to with my daughter's checks she gets from babysitting for our neighbor.

      • toknowinfo profile image

        toknowinfo 

        6 years ago

        This is a very helpful and informative hub. Letting kids have their own savings account is a valuable way to teach them the value of money and good savings habits. It is important to keep up on what the banks do, because sometimes they change the rules in mid stream. Great hub.

      • VirginiaLynne profile imageAUTHOR

        Virginia Kearney 

        6 years ago from United States

        Tipstoretireearly--you are right. I love the fact that I get about the same interest or more than my brick bank savings/checking. So I use my ING DIRECT account for savings and transfer from my own home back and forth as needed.

      • VirginiaLynne profile imageAUTHOR

        Virginia Kearney 

        6 years ago from United States

        I am so glad to help Dee--I was so glad to find this bank myself that I was hoping it would help others.

      • tipstoretireearly profile image

        tipstoretireearly 

        6 years ago from New York

        Great info. I've found that ing direct has some innovative accounts for adults too.

      • Dee aka Nonna profile image

        Dee aka Nonna 

        6 years ago

        This is amazing. I have been looking for online banking information so that we can get accounts started for my grandchildren. The local banks are very difficult make is impossible for kids, who do not have large amounts of money, to enjoy the checking/savings banking experience.

        Thank you for sharing this. Voted up, useful, and sharing.

      working

      This website uses cookies

      As a user in the EEA, your approval is needed on a few things. To provide a better website experience, wehavekids.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

      For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://wehavekids.com/privacy-policy#gdpr

      Show Details
      Necessary
      HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
      LoginThis is necessary to sign in to the HubPages Service.
      Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
      AkismetThis is used to detect comment spam. (Privacy Policy)
      HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
      HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
      Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
      CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
      Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
      Features
      Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
      Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
      Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
      Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
      Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
      VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
      PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
      Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
      MavenThis supports the Maven widget and search functionality. (Privacy Policy)
      Marketing
      Google AdSenseThis is an ad network. (Privacy Policy)
      Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
      Index ExchangeThis is an ad network. (Privacy Policy)
      SovrnThis is an ad network. (Privacy Policy)
      Facebook AdsThis is an ad network. (Privacy Policy)
      Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
      AppNexusThis is an ad network. (Privacy Policy)
      OpenxThis is an ad network. (Privacy Policy)
      Rubicon ProjectThis is an ad network. (Privacy Policy)
      TripleLiftThis is an ad network. (Privacy Policy)
      Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
      Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
      Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
      Statistics
      Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
      ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
      Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)