My Sunday Times article: My children’s accounts are now of little interest

My daughter, with her Stanley the dog moneybox. 

Believe it or not, the nearest I get to a proper job is writing about money. A whole rollercoaster ride of mortgages, savings, investments, insurance, pensions and tax, I’m telling you.

 

This weekend, one of my articles ran in the Sunday Times, born out of my fury that TSB were slashing the interest paid on my children’s Young Saver savings accounts from nearly 3% a year down to below 1% a year.

Here’s the link, although I’m afraid it’s behind the Times/Sunday Times paywall:
http://www.thesundaytimes.co.uk/sto/business/money/savings/article1608644.ece

I hesitated before posting about the article, thinking it was more related to my day job, and less about my normal blog topics like frugal food and gardening.

However, Much More With Less is supposed to be about moving to the country, living on less and making the most of it. So perhaps making sure you get the most possible interest on limited savings is actually bang on topic.

I would certainly love to teach my children to save.

As I said in the article, I would like them to learn that if you salt away savings, rather than squandering the cash on Haribo, the bank will pay you for the privilege by adding interest.

Now they are older and receive the princely sum of £1 a week pocket money, I would also like them to realise that they can save up for things rather than borrowing the money. By forgoing a Kinder egg today, they can save towards a longed-for Lego set later.

Back in the real world, they are much keener on scooting straight down to the sweet shop.

At least I’ve managed to convey the concept of price per kilo to my daughter. Nowadays she’d rather opt for a Co-op offer with 3 bags of 45p sweets for her £1, rather than the smaller amount in a bag of branded sweets. Thumbs up for sensible shopping, even if the dentist/dietician/doctor would disapprove.

I live in hope though, and reckon that accounts that accept amounts small enough for children to save for themselves are a good place to start. If you choose an easy access account, the savings can still be withdrawn if needed. Unlike money boxes, bank accounts are more difficult to raid, whether to satisfy sudden sweet cravings or by siblings with evil intent.

Currently, several high street banks and building societies still offer around 3% on children’s savings accounts, which is not bad when adult accounts often pay much less.

You can find the best paying accounts in this table on the Moneyfacts website:
http://moneyfacts.co.uk/savings/childrens-savings-accounts/

Any top tips on introducing the younger generation to the radical concept of saving rather than spending?  Because I’m not sure that TSB’s approach, by slashing the interest rate on my children’s Christmas money by two thirds, is the right place to start.

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3 Comments

  1. 26th September 2015 / 8:47 pm

    That's ridiculous!!

    How do they expect to attract an army of future customers if they don't offer them something for saving with them. 1% is simply not worth it.

    I'm sticking with my Sealed Pot at home for my day to day savings, picking it up regularly and guessing at what might be in there is more fun than waiting for a bank statement that tells me how little interest my larger scale savings are making.

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