Publication Date: 30/03/2016

One of the greatest milestones in a child’s path to financial literacy is opening a bank account. That first bank account can give them a sense of responsibility, which they can build upon by securing a job or better honing their hobby skills, eg: crafting, baking for resale, to earn extra money. Whether your child is doing chores around the house, mowing the neighbour’s lawn or dog walking, putting money into their bank account and seeing that balance grow is a wonderful experience.

Opening an Account

Depending on their age, you as their parent or guardian, may need to assist them in opening and managing the bank account should they not be at an age to take control over their bank card and pin. You will also have to decide when – weekly or monthly and where – branch or internet deposits are made.  Most banks charge a cash handling fee for in-branch deposits alternatively you may choose to use the banks online account option. Both options allow children to track the growth of their account through continuous deposits.

Account Requirements

The requirements for opening a youth bank account may vary from bank to bank, so contact your bank directly for the exact details, prior to signing up. Generally, the following are the qualifying criteria:

  • Age 16 – 18, have a valid SA smart identity card or passport with a valid SA permit.
  • Under 16, the youth will need their parent’s or legal guardian’s valid barcoded South African identity document or smart identity card or passport with a valid permit and child’s birth certificate.
  • In addition, the youth will need a document reflecting their parents’ or legal guardian’s name, physical address and proof of residence – in the form of a utility bill, rental invoice, electricity or telephone account.
  • Some banks may require a letter from the parent or legal guardian to prove the child lives with them.
  • Some banks may require a minimum deposit to open the account.
  • Non-residents may be subject to additional monthly fees.

Account Benefits

Account benefits vary from bank to bank so compare account benefits, choose your preferred institution and choose the account that is best suited to your daily needs. Benefits can include, but are not limited to the following:

  • No monthly management fee
  • Free bank card
  • Access and manage your money 24/7
    • Free Cellphone and Internet banking subscription
    • Free balance enquiries
    • Free electronic debit transactions
    • Free ATM cash deposits
    • Free in-branch cash deposit
    • Free SMS notifications on all transactions
  • Freedom and flexibility to transact
  • Free prepaid airtime and data recharges
  • Shop online
  • Swipe in Store

Teaching the Importance of Play Money

It is important to teach your children, not only the serious part of money – saving and living within one’s means but to also enjoy the money by having “play” money. Instead of having your child deposit their entire earnings, have them set aside 10 percent to buy or do whatever they want. This will make the tasks they have to perform to earn the money more rewarding and they will realise the payoff for all their efforts. Teach them that it’s OK to have fun with some of the money they earn.

A bank account is your child’s first step to financial responsibility as it can initially be used to deposit an allowance or chore money earned to save towards small buying presents, video games and in some instances purchase like a car. Formal employment takes that financial lesson to the next level. Teaching your child the importance of saving and growing their bank balance while keeping a percentage for play will give them a positive relationship and attitude towards their money that will serve them for a lifetime!