What features should I compare when choosing the right bank account for my kids?

The best bank accounts for kids offer these features: No account opening/establishment fees plus no ongoing fees Bonus higher interest rates if savings conditions are met Parental controls on the account for a young child The ability to link a debit card when the child reaches the age of 12 or 13 The ability to use the debit card to make ATM withdrawals Good educational resources including savings games available online

What conditions have to be met for a child to open their own bank account in Australia?

Legally, a child has to be 12 years of age or over to open a bank account solely in their name. They will need to show a copy of their birth certificate. They also have to be a resident in Australia and have a permanent residential address and phone number. However, some banks and building societies impose their own age limits of 13 or even 14 as the minimum age for a teenager to open an account solely in their name.

What happens to kids’ bank accounts when they reach 18?

Funds in kids’ accounts are usually switched over into standard adult accounts once the customer reaches the age limit of 18, but the bank or credit union will contact the young person before their 18 th birthday to discuss how the account is to be rolled over. Some financial institutions now offer youth bank accounts which stretch from age 12 to 21 or even 25 to avoid the necessity to change accounts once they turn 18.

Do children get a credit rating like adults do?

No, credit reporting does not start in Australia until an individual has reached 18 years of age because it is illegal to offer a credit product to a child under that age.

What is a sweep facility and is it a good thing?

A sweep facility is where a child has two or more accounts, such as a transaction account and a savings account . When a pre-determined dollar level is reached in their everyday account , the excess funds are automatically ‘swept’ into the child’s savings account. In this way, the child can receive their pocket money in their transaction account and when they’ve saved up $50, for instance, that money is automatically transferred into their savings account. Some sweep accounts offer bonus interest if the sweep target is met each month, and some allow the sweep process to happen on a set day or date at a regular time.