Child Savings Account FAQs

If you are thinking about opening a child saving account, there are several different things that you are going to need to look at. Here are some of the most frequently asked questions when it comes to child savings accounts.

What Is the Interest Rate?

One of the most important things that you will need to know is the interest rate of the account. Many times, child savings accounts will pay a higher rate of interest than traditional savings accounts. Since your child has the advantage of time on her side, she can really take advantage of compound interest. Try to find the highest rate of interest that you can for the account.

Are There Deposit Minimums?

Many child savings accounts have a minimum amount that you have to deposit into them each year. For example, they might require you to make at least a $25 contribution each month over the course of the year in order to keep the account open. To avoid any confusion or problems, you should make sure that you understand these rules before getting involved.

Are There Withdrawal Restrictions?

Many child savings accounts also require you to keep the money in them for a certain amount of time. Make sure that you understand how this works so that you do not forfeit any interest or pay any penalties.

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