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D.C. Area Babies
Savings account?
Has anyone opened a savings account for their little one? The grandparents wrote a check to DD. I want to open an account any suggestions on a bank in the DC area for baby savings accounts w/ no fees?
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Re: Savings account?
We are actually just keeping all of our LOs money in our own savings account, and I have an excel spreadsheet that I use to keep track of the total. From what I understand, there are tax implications with opening an interest bearing account for your LO. I didn't really look into it, so this may be totally incorrect, but I was told that if you open an interest bearing account in your child's name, you technically have to file a tax return for them. So, we just decided to keep it in our own account for now.
To endorse a check made out to your LO and deposit it into your account, you just have to endorse it with your name, and then write "parent of child'sname" below it.
as with you own bank accounts, you only have to claim it if you earned over $10 in interest/yr on the account. And then you pay tax on whatever you earned. But I don't think it matters if the $$ is in your account or your LO's account - as long as it's over $10 you have to pay interest. So it might actually be better to have a separate account.
We do have an interest-bearing (the rates are horrible right now, around 1%) for DD, we have it online with ING Direct. Whenever DD gets some $$ as a gift, I put that money into our checking account and then transfer it online to ING.
I think it's a great idea and when she's older, I'll try to find a way to get her involved in keeping track of her money and interest. Hopefully by the time she's 16 or 18, it'll have enough $$ in there (compounded interest, baby!) for her to buy something she needs (a car for college? I can dream...maybe 3 textbooks her 1st semester)
We opened a savings account for DS at Apple Federal Credit Union. You are elligible to join Apple if you live or work in FFX county.
It is an eXtras Student Savings Account and earns 4% interest on the balance up to $1,500, then its the normal interest rate.
We did one at Chevy Chase Bank which is what we use for our accounts. They have a Young Savers Account which doesn't have any fees. You put the kid's name and one of the parent's names on the account.
The interest rates aren't that great but I like that I can easily transfer money to her account and that there are no costs. Once interest rates get better, I'll transfer some of the money into a higher yielding option. But for now, it works for us.
I also plan to set them up a separate 529 account if I can ever get my act together.
It is a little early for us right now, but my parents opened an account for me when I was born. I always loved having "my money" and it did come in handy when I get college (books
). My mom would help me fill out a deposit slip when I received money as a gift and we'd go to the bank together and make a deposit. I'm decently good with my money and saving now, so I like to think this helped!
It is also great for your child's credit because they will have a long established relationship with a bank (at least from what I've been told).
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