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Opening a savings account for 5 year old?

My credit union does not offer a cool kids program but another credit union in town offers a neat program that for every $10 the child deposits they earn points and the points can be redeemed for little prizes.

I was thinking about signing my son up for a savings account. Is this a good idea?  Now that he is 5 I am also considering a weekly allowance and thought putting it into the bank might be a good way to start learning good habits (which I suck at personally and want him to know better :-)

Answer Question
 
Anonymous

Asked by Anonymous at 4:52 PM on Jan. 31, 2013 in General Parenting

Answers (8)
  • yes
    notasha.taggart

    Answer by notasha.taggart at 11:34 PM on Feb. 3, 2013

  • I am going to do the same thing for my son so then he can have money for college, a car, or whatever expensises he needs as he gets older. Good on you@
    Im-HiDdEn

    Answer by Im-HiDdEn at 2:47 AM on Feb. 2, 2013

  • It's never too early to open a savings account. Mine have two each. One with our bank where they put all the gifts of money they get. The other is with Grandpa's bank - he opened it for them when they were babies and puts about 25$ per month into them. He's done this for all of his grandchildren. When they're 18 they get to spend it :)
    winterglow

    Answer by winterglow at 4:53 AM on Feb. 1, 2013

  • I agree with ballad but yes, open an account. The sooner the better!
    jeanclaudia

    Answer by jeanclaudia at 8:12 PM on Jan. 31, 2013

  • That's what I do with my kids. They get $4/week - $2 in savings account, $2 to spend/save as they like.
    missanc

    Answer by missanc at 6:40 PM on Jan. 31, 2013

  • Thanks so much for that tidbit Ballad- It sounds dumb and is common sense but I had not really considered how much he should put into it each week. Was going to try $5 a week allowance (no clue if that is reasonable or not) so half into savings each week is 10 bucks a month which I think will be good.... Any other ideas?
    Anonymous

    Comment by Anonymous (original poster) at 5:24 PM on Jan. 31, 2013

  • You might consider giving him a weekly allowance and helping him put *half* of it in the bank so he can save up for something big, and letting him spend some. That's how he will learn good habits. I wouldn't make him leave all of the money in the bank indefinitely because then he'll feel like he's not gaining anything, but maybe he could save toward a new bike or whatever it is he dreams of, and then save more as he gets older. I would use the account as a teaching tool rather than, say, a college fund, which is too big and far away for him to grasp. I have a college account for my daughter that I put money in, but that's separate from me teaching her how to prioritize what she wants and spend her money appropriately. Good luck and good for you starting early!
    Ballad

    Answer by Ballad at 5:11 PM on Jan. 31, 2013

  • No harm in starting early. My kids have all had savings accounts since they were 2-3. We don't participate in the cutesy stuff though, they don't want to.
    Anonymous

    Answer by Anonymous at 5:03 PM on Jan. 31, 2013

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