When to open and how to use accounts for children or minors

It is possible for a minor to open a bank account. However, there are some guidelines to follow in order to manage and use this type of account
Although we mostly associate the concept of a bank account with adults who are looking for returns, hoping to save some money, or who are applying for an overdraft, minors can also use these types of products. In fact, it is quite common for an account to be opened in a baby's name if the parents or close relatives (grandparents, uncles and aunts, friends, godparents, etc.), want to ensure that the child has some savings from the moment they are born. These types of accounts are called children's accounts, but when is the best time to open one and how should they be used? Discover more about when and how to use them below.
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When and how to open an account for a child or minor.

The best time to open an account for a child is relative and depends on the particular circumstances. However, as mentioned above, a good time to do this would be when the child is born. By doing this, you can start to invest in their future. However, you can also open an account at a later date when the child is older to help them learn about how important it is to save money and to acquire the habit of doing so.

The requirements for opening such an account are very clear. If the account holder is a minor, they must have a legal representative. The minor's legal representative is usually is their legal guardian, which is generally their father or mother (proof of such status can be provided using a family record book). However, this position can also be held by another person, as long as they can provide evidence of their status via a court ruling or any other document that proves they are the minor's guardian.

In order to open an account for a child, they must either have an ID Card or a provisional Tax Identification Number issued by the Tax Agency.

What you must consider carefully about using children's accounts

Once the account has been opened, you must follow some very important guidelines to manage it. The first of these is that if the account is for a minor, it must not be used in the legal representative's own interest. Doing so may lead to legal consequences.

A mistake that can be avoided often occurs: although the parents act as legal representatives, only the child can be the account holder if the funds in it are intended for them. If this rule is not followed, tax or inheritance misunderstandings may arise if a parent dies.

Depending on what type of children's account you choose, it may or may not be linked to a card. This will be a debit or prepaid card rather than a credit card. Account transactions performed by the minor will only be accepted if they have been authorized and confirmed by the legal representative.

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Tips on how to open and use a children's account

There certainly are a lot of recommendations on how to do this; however, the following three tips will help you open and manage an account:

  • Search, compare and choose: this is something you must do any time you acquire a product, and these types of products are no exception. Choose which is the best option based on the child's age, how the account is going to be used and whether or not you intend to leave money in the account long-term in order to generate returns.
  • Debit card with limits: this can be an excellent idea to help the child learn to be responsible and develop autonomy. However, this area is directly related to the child's age and the parents' decision. At BBVA, you can obtain a credit card from the age of twelve with the authority of a representative who is an adult.
  • Read the conditions thoroughly: as with all products, you must do this to avoid any unexpected surprises. Make sure there are no confusing or special clauses and that the account is not linked to any other products or cards (unless you want it to be).

Children's accounts definitely offer some interesting benefits. For example, there are usually no administration or maintenance fees or charges to transfer funds from the parents' account. On opening an account, children are often offered gifts such as games or other products designed for them.

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