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Key Highlights
- A child savings account, popularly known as a minor account, is similar to a regular savings account.
- If your child is above 10 years of age but below 18 years, he/she can normally operate the account independently.
- Your child can typically experience various banking facilities like ATM/debit card, internet banking, cheque book, etc.
In today’s fast-paced world, your child should be well-equipped with various life skills, including financial literacy. As a parent, the first step you can take towards this journey is by opening a child savings account.Through a child savings account, you not only introduce him/her to banking but also simplify financial concepts. This prepares your child to manage his/her finances effectively in future.
This blog explains what a child savings account is and the account opening process to help you with the necessary details.
What is a Child Savings Account?
A child savings account or a minor savings account is similar to a regular savings account. It is a bank account under 18 (without a parent), where your child can learn about saving money and using it responsibly. Here are some key points to help you understand this account type better:
Operations
If your child is above 10 years of age and a minor, he/she can usually operate the account independently. However, banks usually fix a limit in terms of the amount and the age of the child before they are allowed to operate it independently. You may talk to your banker to understand these limits and other restrictions.
Banking Facilities
Your child can usually experience banking facilities like ATM/debit card, internet banking, cheque book, etc. Through this, he/she is exposed to various modes of executing a transaction and learns how to manage money in the real world.
Transaction Details
Just like a regular savings account, a child savings account usually comes with a passbook and e-statement facilities. A transaction-wise break-up makes your child appreciate the importance of prioritising expenses and tracking savings.
Post-Majority Operations
Once your child attains majority, the minor savings account usually gets converted to a regular savings account.
What Are the Documents Required for Opening a Child Savings Account?
Here is an indicative list of documents that may be needed for the account opening process:
- Duly filled account opening form
- Birth proof of the minor
- Identity and address proof of the guardian
- Declaration from the guardian
Note: You may consult your banker to understand the specific requirements, as applicable in your case.
What is the Process for Opening a Child Savings Account?
You can open a minor savings account online or offline at your convenience. It is always a good practice to check with your specific bank about their requirements under both these methods. In the meantime, read on to learn the account opening steps:
Steps to Open a Children’s Savings Account Online
Here are the steps normally followed to open a minor savings bank account online:
- Step 1: Visit your bank’s website.
- Step 2: Search for the ‘Savings Account’ option on the webpage and click on the option signifying account opening.
- Step 3: Fill out the details asked for and submit the necessary documents.
- Step 4: Finish the video KYC process, as applicable.
Note: While you can open a minor savings account online, you must know that some banks require physical verification for account opening.
Step to Open a Children’s Savings Account Offline
Another way to open a minor savings account is by visiting the nearest branch of your bank. Here are the steps:
- Step 1: Express your interest to open the account and ask for the applicable form.
- Step 2: Return the duly filled-out form to the banker.
- Step 3: Provide the necessary documents, including KYC papers.
- Step 4: The banker will check all the details and open the account post successful verification.
Open a Child Savings Account to Teach Them the Value of Money
When your child is actively involved in banking, he/she will understand the importance of saving and budgeting. They will also appreciate the value of money even more and learn how to prioritise expenses.Once your child knows the concept of savings, you can subsequently introduce him/her to investments. To begin with, you can teach about investments through fixed deposits that offer guaranteed returns and create a secured corpus. Also Read: How to Open a Savings Account Online & Offline: Step by Step Process
FAQS - FREQUENTLY ASKED QUESTIONS
What is a bank account under 18 without a parent?
A bank account under 18 (without a parent) is a minor savings account, similar to a regular savings account.
Which documents are needed to open a bank account under 18 without parent?
Documents needed to open a bank account under 18 (without a parent) generally include the minor’s birth proof, guardian’s identity and address proof, a declaration from the guardian, etc.
How can I open a bank account under 18 without parent?
You can open a bank account under 18 (without a parent) either online or offline.
Can my child operate a bank account under 18 without parent independently?
If your child is above 10 years, he/she can normally operate a bank account under 18 (without a parent).
Are there any restrictions on the operation for minors?
Banks normally impose a limit in terms of age and the amount allowed to operate. You may talk to your banker to understand these better.
What banking facilities does the bank account under 18 without parent offer?
A bank account under 18 (without a parent) typically offers banking facilities like ATM/debit card, internet banking, cheque book etc.
What happens to the bank account under 18 without parent after my child attains majority?
After your child attains majority, the bank account under 18 (without a parent) typically
gets converted into a regular savings account.
Why should I open a minor savings account for my child?
A minor savings account introduces your child to the world of banking and teaches
important financial skills.
How can I teach my child the different ways of transacting in the real world?
You can introduce your child to banking facilities like ATM/debit card, internet banking, cheque book, etc. through a child savings account.
Is there a way to explain to my child the importance of prioritising expenses?
The passbook and e-statements give a transaction-wise break-up. You can leverage these to teach your child the importance of prioritising expenses.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
