Nationwide Accounts for Kids

Written by Karen Bryan

nationwide logo blue cardThere are several Nationwide accounts for kids.

I think that it’s useful for young people to get accustomed to running their own banking from an early age.

The Nationwide FlexOne Current Account is available to 11-17 year olds. It offers a cash card or debit card, which can be handy for online shopping. The FlexOne Current Account pays a variable rate of 1% on balances up to £1,000. Therefore, it’s not a good idea to leave too much cash sitting in this account.

I think it’s also a good idea for young people to get into the habit of saving regularly.

One of the biggest benefits of having an Nationwide FlexOne Current Account is that it gives access to the Nationwide FlexOne Regular Saver. This savings account pays a variable rate of 3.5%. There’s a maximum permissible balance increase of £100 per month. That’s a much higher  rate of interest than the 2% paid on a standard Nationwide Regular Saver. If you open a FlexOne Regular Saver before you are 18, you can hold the account until you are 23.

Another Nationwide account for kids is the Smart Limited Access, which pays a variable rate of 3.0%. In order to retain this rate, no more than one withdrawal can be made per year. This account can be opened by a child aged 7+, or by adult on behalf of a younger child. The maximum balance is £50,000.

Although most kids won’t pay income tax on interest from their savings, there’s also an option to open a Nationwide Smart Junior ISA, paying a variable rate of 3.25%. Junior ISAs have an annual allowance of £4,080. This account can’t be accessed until the young person is 18, although it can be transferred to another provider. If they saved the maximum allowance per year, the young person could end up with a large tax-free sum by the time they reach 18. The initial funding for the ISA can only come from an adult’s Nationwide current account or instant access savings account,which is restrictive.

It seems to me that luring in children as customers with good interest rates is a successful policy. I opened Nationwide accounts for our twin sons when they were young. Now aged 28, they both still hold some accounts with Nationwide.

In my opinion, the Nationwide accounts for kids are pretty good. But it’s always worth keeping an eye on the rates of interest paid to ensure that they remain competitive.