Teaching kids and teens the value of saving money is a timeless lesson, and in April 2025, some banks and credit unions are making it easier than ever with impressive interest rates on youth savings accounts. The standout offer comes from Spectra Credit Union, boasting an eye-popping 10.38% APY—far surpassing most adult high-yield savings accounts. Several other institutions offer rates between 5.00% and 7.00% APY, though these high rates often come with balance caps.
Our team has spent years researching youth savings accounts, diving into dozens of options to bring you the best choices for your child or teen. Below, you’ll find our top picks, featuring accounts with exceptional rates, low fees, and features designed to help young savers thrive.
Why Choose a Kids or Teen Savings Account?
A savings account for your child isn’t just about stashing cash—it’s a hands-on way to teach financial responsibility. These accounts, often managed by a parent or guardian, help kids learn how money grows over time through interest. Plus, many come with perks like ATM cards for teens or no monthly fees, making them practical for everyday use.
Also Read: How Investing Just $100 a Month in Stocks Could Transform Your Wealth in 30 Years
Our Top Picks for April 2025
1. Spectra Credit Union Youth Savings – 10.38% APY
- Age Eligibility: Up to age 21
- Rate & Balance Cap: 10.38% APY on the first $1,000
- Minimum Balance: None
- Monthly Fees: None
- ATM Card: Available for ages 13+
- Overview: Based in Concord, California, Spectra Credit Union (also operating as Chevron Federal Credit Union) has been serving members since 1973. Joining is simple: agree to a free one-year membership with the Financial Fitness Association and maintain $25 in a savings account. This account’s sky-high rate makes it a fantastic choice for young savers.
- Rate Verified: January 31, 2025
2. BECU Early Saver Account – 5.90% APY
- Age Eligibility: Up to age 17
- Rate & Balance Cap: 5.90% APY on the first $500; 0.35% APY on higher balances
- Minimum Balance: None
- Monthly Fees: None
- ATM Card: Yes
- Overview: Founded in 1935 as Boeing Employees Credit Union, BECU is now open to anyone nationwide with a $1 donation to the BECU Foundation. This account is perfect for younger kids starting their savings journey.
- Rate Verified: January 31, 2025
3. Genisys Credit Union High Yield Youth Savings – 5.12% APY
- Age Eligibility: Up to age 18
- Rate & Balance Cap: 5.12% APY on the first $500
- Minimum Balance: None
- Monthly Fees: None
- ATM Card: Yes
- Overview: Headquartered in Auburn Hills, Michigan, Genisys has been around since 1964. Join by donating $5 to the Arthritis Foundation or Paint Creek Center for the Arts and keeping $5 in a savings account. A solid option for teens learning to manage money.
- Rate Verified: January 31, 2025
4. FourLeaf Federal Credit Union Student Savings – 5.00% APY
- Age Eligibility: Up to age 20
- Rate & Balance Cap: 5.00% APY on the first $1,000
- Minimum Balance: $5
- Monthly Fees: None
- ATM Card: Yes
- Overview: Established in 1941 in Bethpage, New York, FourLeaf originally served Grumman aerospace employees. Today, anyone can join with a $5 savings account deposit. This account offers a competitive rate for young adults.
- Rate Verified: March 3, 2025
5. Service Federal Credit Union Primary Savings – 5.00% APY
- Age Eligibility: Any age (same account as adults)
- Rate & Balance Cap: 5.00% APY on the first $500
- Minimum Balance: $5
- Monthly Fees: None
- ATM Card: Yes
- Overview: Based in Portsmouth, New Hampshire, since 1957, Service Federal Credit Union welcomes members with a free one-year American Consumer Council membership and a $5 savings balance. Great for kids of all ages.
- Rate Verified: January 31, 2025
6. Alliant Credit Union Kids Savings – 3.10% APY
- Age Eligibility: Up to age 12
- Rate & Balance Cap: 3.10% APY on balances of $100 or more, no cap
- Minimum Balance: None, but $100 average daily balance required to earn interest
- Monthly Fees: None
- ATM Card: Yes
- Overview: Chicago-based Alliant, founded in 1935, opens its doors to anyone with a donation to the Alliant Credit Union Foundation. This account is ideal for younger kids with growing savings.
- Rate Verified: January 31, 2025
7. Capital One Kids Savings – 2.50% APY
- Age Eligibility: Up to age 17
- Rate & Balance Cap: 2.50% APY on all balances
- Minimum Balance: None
- Monthly Fees: None
- ATM Card: No
- Overview: As one of the largest U.S. banks, Capital One offers accessible online banking nationwide. This account’s consistent rate across all balances makes it a reliable choice.
- Rate Verified: January 31, 2025
8. USAlliance Financial MyLife Savings for Kids – 2.00% APY
- Age Eligibility: Up to age 12
- Rate & Balance Cap: 2.00% APY on the first $500; includes a $10 annual birthday deposit through age 12
- Minimum Balance: None
- Monthly Fees: None
- ATM Card: No
- Overview: Founded in 1966 in Rye, New York, USAlliance originally served IBM employees. Join with a free membership to a partner organization and a $1 savings balance. The birthday bonus is a fun perk for young savers.
- Rate Verified: January 31, 2025
Also Read: What Is Personal Finance, and Why Is It Important?: A step-by-step guide
How Kids Savings Accounts Work
These accounts are custodial, meaning a parent or guardian oversees the funds until the child reaches adulthood (typically 18, depending on the state). Anyone can contribute, but gifts are irrevocable—once money goes in, it belongs to the child. In 2025, you can gift up to $19,000 annually without triggering gift tax.
Custodians must use the funds for the child’s benefit, per the Uniform Gifts to Minors Act (UGMA) or Uniform Transfers to Minors Act (UTMA). Interest earned may be subject to the “kiddie tax”:
- Unearned income (e.g., interest) under $1,350 is tax-free.
- Income between $1,350 and $2,700 is taxed at the child’s rate.
- Income over $2,700 is taxed at the custodian’s rate.
How We Chose These Accounts
Our research team evaluates hundreds of federally insured banks and credit unions daily, focusing on youth savings accounts available in at least 40 states. We prioritize high APYs, low or no fees, and reasonable balance requirements. For credit unions, we only include those with donation requirements under $40 to join. Accounts are ranked by APY, with ties broken by higher balance caps or alphabetical order.
Why Trust Our Research?
Since 2010, our mission has been to empower Americans with clear, unbiased financial guidance. We’ve been analyzing kids and teen savings accounts since 2022, starting with over two dozen options. Our recommendations are based on thorough research, independent of any banking partnerships, ensuring you get the best options for your family.
Final Thoughts
Opening a savings account for your child or teen is more than a financial decision—it’s a step toward building lifelong money skills. With rates as high as 10.38% APY in April 2025, now’s a great time to start. Compare the accounts above to find the right fit for your family’s needs and watch your young saver’s money grow.