A baby savings account is different from a kids savings account in that you'll be the only person who can access that account. Though you can't teach babies about saving, you can set money aside for their future. As they grow, you can use the opportunity to teach them about money, saving and how to plan for the future. There are a number of different kinds of baby savings accounts available, and the best thing to do is speak with your bank manager to find which is the right account for your goals.
1. Consistent Saving
When you're juggling household income, expenses and savings for yourself, it can be difficult to remember to stick extra money into your account for baby. When you have a separate account to save for your baby, you have somewhere to automatically deposit money and know it's set aside in a safe place.
It's not smart to keep any money in the house, and new parents tend to use a change jar to save money for their new little one. This is generally because it's hard to set aside chunks of money for a new savings account, but dropping end of the day change and dollar bills into a jar is a much easier way to save without feeling like you're damaging your monthly expenses. A baby savings account gives you a place to take that money jar every week and deposit it.
3. Removes Temptation
A new baby and the change in expenses can be heavy on your monthly income, especially if you're paying medical bills. While it's important for you to save for baby, having a place to put that money will take the temptation out of your house and into a safe place. No one ever intends to "borrow" money from savings, but it happens when times get tough. Out of sight, out of mind can really help in this situation.
4. Grows Your Money
You can save at home and stick money away in a jar, safe or other location, but your money is better off sitting in a savings account where it will collect interest over time. Even if the interest is low, it's more than if you had it sitting at home. Shop around to find the best interest rate for savings accounts to make the most of your money.
A baby savings account offers many of the same benefits of a regular account and makes it easier to save for your little one. The future of your children is vital to you and starting them off on the right financial foot is one of the best things you can do for them. As they get older, you have the opportunity to teach them the value of money and how saving from the very beginning has given them a head above the rest in planning for their future.