Why Should You Open Minor Savings Account

One of the important ways to protect the future of your kids is to motivate them to save. You should ensure as a parent that the future of your child is secure. Most parents emphasise that they are saving for their kids. You can educate your child about it in several respects, including buying an Insurance Policy or opening an account through Digital Banking.

As banks allow you to open accounts for minors, you need not wait until your child turns 18 to use banking facilities. To plan their future from the start, open and operate the kids Saving Account.

Following are the benefits online Saving Account opening for kids:

• It shows the importance of money.
• They become disciplined with money matters.
• It helps them remain focused on objectives.
• Thanks to compound interest, they learn new skills.
• Saving teaches them how to save for future expenses.

Factors to consider before you open a Bank Account for minors:

Age

For minors, banks allow you to open two kids Savings Account, depending on your child's age group:

• Below ten years
• Between 10 and 18 years of age

Remember the age of your child before opening the Savings Account. If your child is under 10 years, open a Joint Account, of which the joint holder will be the child and one of the parents. In this case, you assist them in operating the account as it brings about a savings discipline. The account becomes inactive until your child is over 18 years of age, transforming into a Regular Savings Account.

Funds transfer

Check with the bank if you can transfer funds via National Electronic Fund Transfer or Real-Time Gross Settlement or Immediate Payment Service using banking apps when you plan to open a kid's Savings Account. The bank allows you to do so with ease if you want to move money from your account to a child's account.

Spending limits

There is a spending cap on these account types, and it varies from bank to bank. Some banks make it possible for you to spend Rs. 1,000 to Rs. 2,000 every day. When the account opening process gets started, banks issue debit cards. In the kid's Saving Bank Account, the banks often restrict the number of debits you make in a financial year.