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Best of the Best 2019: Best Kids' Savings Accounts

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GOLD WINNER: POLICE BANK (BANK);

GOLD WINNER: BCU (NON-BANK)

Children love junior bank accounts - and so do financial institutions, because once a child signs up there is a strong likelihood they'll stay with the same bank for life.

This long-term loyalty has been a factor behind ASIC's decision to review primary school banking programs. It's also a reminder to parents and carers to choose children's bank accounts with care.

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The recent negative publicity about school banking programs is quite separate from the issue of kids' savings accounts. Studies show that youngsters who have their own bank account can have higher levels of financial literacy by their teens.

However, it's important to select an account that genuinely rewards children with conditions that are easy to understand and comply with.

Police Bank's Dynamo account lets children under 18 earn a total of 3% on their savings just by depositing $5 each week and making no withdrawals in a month.

Even if these conditions aren't met, the base rate of 1.5% is still more generous than it is for many other junior savings accounts. As children get older, the account provides increasing levels of access with full online access available from 16.

The Scoot Super Saver from BCU pays a compelling of 3.5% when at least $20 is deposited each month and no more than $5 is withdrawn in the same period. The downside of this account is that it's only available for children up to the age of 12.

Greater Bank's Life Saver is available to under-25s, so it could be used by grown-up children to save for a holiday, first car or even a first home.

Newcastle Permanent's Smart Saver account offers a similar deal, being available right through to age 25.

A 3% rate applies when a child grows their balance by $10 a month. This account also has the flexibility of two withdrawals a month without interest penalties.

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