Best For
Recommended Bank
APY
Opening Minimum
Minimum to Earn Highest APY
Best Interest RateWorkers Credit Union SaveUpUp to 3.61%$5None

Best for a BabyUSALLIANCE MyLife Savings for KidsUp to 2%$1None
Best for TeensCapital One Kids Savings0.30%$0.00None
Best Teaching ToolsPNC S is for Savings0.01%$25.00$1
Best Credit Union Account for KidsAlliant Kids Savings0.55%$5.00$100

Best interest rate: Workers Credit Union SaveUp Account

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Consider this if you want the highest possible interest rate for building your child's savings.

  • Monthly fee: $0
  • APY: Up to 4.37%
  • Opening minimum: $5

Although the SaveUp savings account with Workers Credit Union isn’t exclusively for children, it offers one of the highest APYs for savings accounts. Anyone under the age of 18 can open a savings account with the credit union as long as there is an adult joint owner on the account who is 18 years of age or older.

The SaveUp savings account offers a tiered APY rate. You'll earn 3.56% APY on balances up to $999.99 — or 3.61% APY on balances up to $999.99 if you also have at least $50 in direct deposits for the month. APYs decrease on any balance equaling $1,000 or more, but you’ll still receive the phenomenal 3.56% or 3.61% APY on your first $1,000.

It’s also easier to become a member of Workers Credit Union than it is with other credit unions. You can be eligible for membership if you are an immediate family member of someone who is a member, if you live, work, worship or attend school in Lowell or Worcester, Mass.; if you or your family member work for a participating employer or through a charitable donation to the United Way of North Central MA. You can also become a member through the Financial Fitness Association, in which the credit union will pay your initial membership fee.


Best for a baby: USALLIANCE MyLife Savings for Kids

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Consider this if you'd like an incentive to save consistently until your child's 18th birthday.

  • Monthly fee: $0
  • APY: Up to 2.00%
  • Opening minimum: $1

USALLIANCE offers the highest APY of 2% for balances up to the first $500, which is nice if you’re just starting out with a savings account. However, on balances beyond the first $500, the APY drops to 0.02%. As a bonus, however, the USALLIANCE MyLife Savings for Kids includes $10 in Birthday Bucks each year for your child’s birthday.

USALLIANCE Financial is a credit union so you’ll need to become a member to open an account. You’re eligible for membership if you live, work or worship in certain Massachusetts counties; West Haven, Conn.; or certain districts in New York. Also, if you are a state or local government employee or retiree in New York counties and employees of more than 175 Select Employee Groups. However, if you don’t live or work in these areas, you can become a member by joining any of four other associations, which are free to join.


Best for teens: Capital One Kids Savings

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Consider this if you want a savings account with decent interest and educational features for your teenager.

  • Monthly fee: $0
  • APY: 0.30%
  • Opening minimum: $0

The Capital One Kids Savings Account offers a great combination of a decent APY and educational features that give teens a chance to practice actual money management. This account not only carries an interest rate of 0.30% APY, it also gives your child an online account for checking the balance, making deposits and tracking their expenses. And since an adult is required to act as the joint account-holder, the account also strikes a balance between independent learning and parent supervision.

Both you and your teen will be able to manage the account through Capital One's convenient mobile banking app. In addition, Capital One also operates hundreds of branches, supplementing the online experience if you prefer brick-and-mortar banking. Even if your family is located outside of the bank's physical footprint, you can open an account from anywhere as long as you're willing to manage your money through the bank's website and mobile banking app.


Best teaching tools: PNC S is for Savings

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Consider this if you want an account with engaging educational tools for your young child.

  • Monthly fee: $0 if under 18
  • APY: 0.01%
  • Opening minimum: $25

Among traditional banks, the PNC S is for Savings account goes the furthest in providing tools to teach your child about managing money. Though the interest rate is just 0.01% APY, parents who emphasize learning by doing will appreciate the variety of activity-based features on PNC's child-oriented account. Kids learn how to divide their savings towards customized goals through a drag-and-drop feature, and the engaging use of Sesame Street characters provides just one more feature you probably won't find at other banks. All of these options make the PNC S is for Savings Account best-suited to younger children.

However, we recommend that you supplement this account with a stronger interest-earning option. 0.01% APY is the lowest possible rate that a bank can put on any type of deposit account, and it would be inefficient to keep the bulk of your child's savings at PNC just for the child-friendly features. With no monthly service charge for children under 18, it's certainly possible to keep the account at a low balance and use it just for teaching. If you already bank with PNC yourself, then managing automatic deposits to this account becomes even easier.


Best credit union account for kids: Alliant Kids Savings Account

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Consider this if you're looking for a low-fee, kid-friendly credit union account.

  • Monthly fee: $0 (or $1 if receiving paper statements)
  • APY: 0.55% on balances $100 and more
  • Opening minimum: $5

If you're willing to try a credit union instead of a bank, the Alliant Kids Savings Account gives you one good reason to sign on. The 0.55% APY you can earn on balances of at least $100 beats any rate you'll be able to find at a brick-and-mortar bank. We also recommend Alliant Credit Union over other credit unions because it's both larger and easier to join. While many credit unions restrict membership based on profession or region, Alliant Credit Union has a strong online presence and allows anyone to join after becoming a member of Foster Care to Success. The credit union will pay a $5 membership fee to Foster Care to Success on your behalf.

You'll need to open this account on or before your child's 12th birthday and sign yourself up as the co-owner of the account. Alliant Credit Union provides the initial $5 deposit required to open the account, which can then be used like any regular savings account to help teach your child about saving. Children aged 13 to 17 can also benefit from an Alliant Teen Checking Account, which automatically links to the savings account. This gives your child the chance to start practicing with both a checking and a savings balance.


Finding the right savings account for your child

Ideally, the savings account you choose for your child will have both a strong interest rate and a way to get him or her involved directly in managing the account. Realistically, it won't be easy to find a bank that delivers both in the same package. Instead, you should either choose one of the two features or search for two accounts that each specialize in a different area. For instance, you might want to find a high-yield savings option online, then supplement it with a more practical brick-and-mortar experience from a bank that actually operates in your area.

On the other hand, if you feel that it's more helpful to teach your child using websites and online banking tools, it might be a better option to skip the brick-and-mortar account altogether. Since banking seems to be increasingly focused on electronic and mobile platforms, it makes sense to prepare your child for the methods that many banks will favor as they grow older.

Methodology for best savings accounts for kids

To find the best savings accounts for kids, MagnifyMoney looks at hundreds of financial institutions offering savings accounts for children. Specifically, we consider the following factors when making our selections for the best accounts for kids:

  • Savings account annual percentage yield (APY): Savings accounts for kids often carry lower APYs. We heavily weighted the APYs offered by each bank in terms of both magnitude and consistency. Higher savings account interest rates were prioritized over lower rates. Due to the variable rates on savings accounts, we also gave additional consideration to banks that were known to maintain a competitive APY over longer periods of time.
  • Minimum deposit and balance requirements: To ensure accessibility to all customers, we focused on banks that welcome deposits of all sizes, where the ideal banks in this category have a minimum balance and deposit requirements of $0.
  • Bank account fees: Unnecessary fees can eat into a kids’ savings account. As such, we gave priority to banks that offer low or no fees, including account maintenance fees, service charges and other surcharges. If accounts had the same APY and minimum requirements, we went with the account with lower fees.
  • FDIC-insured and NCUA-insured: It is crucial for your deposit accounts to be protected by FDIC insurance and NCUA insurance in the case your financial institution were to fail. As such, we only included FDIC-insured and NCUA-insured savings accounts on our list.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.