Lloyds TSB has increased the rate on its Young Saver account to 3% AER, which takes it to the top of the Which? Best Rate tables for children’s savings accounts.
The children’s account from Lloyds TSB is for kids up to the age of 16 and pays a variable rate of 3% AER for balances up to £20,000 and 0.5% for anything over that amount.
When the child reaches the age of 16, the account converts into an Easy Saver account and it’s for the youngster to then manage the account.
Check the Which? children’s savings Best Rate accounts to see how this account compares with others in the market.
Competition at last in this area
Paul Davies, savings analyst at Which?, said of the account paying 3%: ‘Lloyds TSB has placed this account at the top of the Best Rate tables alongside a Northern Rock account paying the same rate.
‘Which? looked into the whole area of children’s savings accounts in August and found that the average rate for a children’s easy access account was just 1.01%.
‘The move by Lloyds TSB brings more competition into an area where half of children’s accounts still pay 1% AER or less, a poor rate in anyone’s terms.
‘It may be that providers are seeking to make their children’s accounts more attractive in advance of the launch of Junior Isas in November 2011. Whatever the motivation, it’s good to see a big name offering a decent rate and providing an incentive for children, or their parents and grandparents, to save for the future.’
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