Which savings account is best for your child's communion money? We take a look at all of the child saver accounts available, and with interest rates so low now we ask, should you bring your child's communion money to the bank at all?
Our kids are hauling in a staggering amount of communion cash.
An average child should take home more than €500 in communion money this year according to a survey by Ulster Bank. Another survey, by mummypages.ie, says that 1 in 5 kids will get their lace-gloved little mitts on more than €1,000!
Communions are so lucrative that actor and screenwriter Stephanie Preissner said in the Examiner recently that: “My best financial decision was making my first holy communion. I made more money on that day than I have in any single day since!”
So what should our children do with all that communion cash? Or more to the point, what should we parents make them do with it?
Communion money traditions
Once the festivities are over and the cash has been counted, it is traditional to begin our children’s financial education. Yep, time to try and teach ‘em the value of a euro… or five hundred!
And time for us Mammies and Daddies to take our loaded little charges to the bank, open accounts and make those deposits. Sure isn't opening a bank account as much a part of the Irish communion tradition as the main event itself?
Taking away all that cash does seem like a terrible injustice though. And while we try to explain those lofty financial principles to our kids - like the importance of saving and the value of compound interest - they glaze over and think of all the fun stuff they can’t buy now that their 500 quid has been taken away by some stranger standing behind a sheet of bulletproof glass.
And to add insult to injury, all they'll probably get in return for their huge haul is a deposit book and a crummy moneybox.
Children's financial education
It has also become traditional at this time of year for us at bonkers.ie to give Mammies and Daddies a list of the best child saver accounts for their kids’ communion cash. So, of course, we’ll continue that tradition here, but I feel I should mention something important first…
It’s going to be very difficult to teach our children the value of compound interest this year.
There, I said it.
And it’s going to be darn hard to teach them the value of saving money too.
That’s because the crummy moneyboxes are probably worth more than the interest a kid will receive after their €500 has been on deposit for a year.
With deposit rates so low and DIRT so high right now, that €500 will earn just €2.99 after a year in a middling child saver account.*
And compound interest? Forget about it...
By the time our communion kids reach college age, that €500 may only be worth €531.24 Yup, that’s a measly €31.24 earned on €500 after 10 years.
So what’s a parent to do then?
Well, you could let your kid blow all that money on sweets and whatever latest toy craze is sweeping the nation but they probably won’t learn any life skills doing that.
Or, you could still take your kid to the bank, open an account, and use the opportunity to explain why you chose the bank that you did. Was it because of a freebie? A good rate of interest? The right features? Lots of branches?
It’s really worthwhile choosing carefully because chances are that the bank you bring your child to with their communion money will be the bank they stay with for life. Imagine that. You could be choosing the bank that your child will open a current account with, and maybe even take out a mortgage with too.
And with that in mind, here’s our list of the best bank accounts for children. We’ve even included our opinion for good measure too!
Ireland's best children's savings accounts
- Rate – 2.00% AER
- Incentive or freebie – Savings Gang moneybox
- Maximum balance - €1,000
- Deposit book – not stated
- Online access – yes
- Easy access – yes
This is a demand deposit account for kids with a very good interest rate of 2.00%. However, any money deposited over €1,000 will earn just 0.1% so may not be ideal for the flusher communion kids, or those that want to save regularly.
- Rate – 2.50% AER
- Incentive or freebie – none
- Maximum balance - €5,000
- If the account balance goes over €5,000 you lose the Bonus Rate for good on the whole balance in your account and the variable rate of interest (currently 0.25%) will apply. Even if you reduce your balance back to €5,000 or less the variable rate of interest (currently 0.25%) will be applied. A conditional bonus is available.
- Easy access – yes
- Deposit book – no, but annual statement provided
- Online access – no
This is more a children’s current account than a communion money savings account. Kids can only access the account through Bank of Ireland branches, but only parents can top up the account online.
EBS Children’s Savings Account
- Rate - 1.75% AER
- Incentive or freebie – €20 credited to account after 6 months as long as €50 balance is maintained
- Incentive or freebie – piggy bank, stickers and gift cards for friends and family, so they can gift a lodgement into the account
- Maximum balance - €5,000
- Deposit book - yes
- Online access – yes
- Easy access – yes
This is exactly what you want from a kids’ savings account. It’s well thought out, has a decent rate of interest, online access, and you can deposit and withdraw as you wish. It even offers a cash incentive and comes with a piggy bank.
Ulster Bank urfirst Savings Account
- Rate - 0.95% AER
- Incentive or Freebie – Henri Hippo Moneybox
- Maximum balance – none
- Deposit book – not stated
- Online access – not stated
- Easy access - yes
The iconic Henri Hippo is still on the go! Sure, you don’t need a moneybox, but you do want a Henri Hippo Moneybox in your house, don’t you? And the interest rate with the urfirst Savings Account is ok too. Plus there’s no maximum balance, so it’s a good account to help foster that regular saving habit.
Permanent TSB Children’s Safari Saver Account
- Rate - 0.25% AER
- Incentive or freebie – none
- Maximum balance - €19,999
- Deposit book – no, but an annual statement is provided
- Online access – yes
- Easy access – yes
This is essentially a demand deposit account with the word “Children” in its name. Its rate of interest is pretty low but is has a healthy maximum balance. It doesn’t offer any special child-friendly features or freebies. But then do you need a moneybox or another backpack?
* Calculations are based on a rate of 0.95% AER and DIRT at 37% has been deducted.
