Principality Building Society is offering 2.75% interest rate on savings | Personal Finance | Finance
Launched in 2019, the Welsh building society’s Earner Learner account was designed and set up in order to help children learn about saving through “activity packs, storybooks and stickers”. Children will only need £1 to open their account and the maximum monthly deposit that can be put in is £250. Children do not need to pay money into the account every month. The maximum investment which the account can hold is £20,000.
The account can only be opened in one of Principality Building Society 71 branches as the bank wants children to experience visiting their local branch regularly to pay in money.
The account has been designed for young children however the oldest a child can be to open an account is 17 years.
For children under the age of 14 years, the account must be opened as a signatory account.
For a child aged 14 to 17 years, the account can be opened as a signatory account or managed by themselves.
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The child’s account can be managed in a Principality Building Society branch, at an agency or by post.
The Learner Earner must be opened by a parent or legal guardian over the age of 18 years.
This can also be a grandparent or other close relation to the child.
The account can also have up to two adult joint account holders.
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The named owner/holder of the account however will be in the child’s name.
The interest on the account is calculated on the money in the account each day and is paid into it on January 1 every year.
If the child had £100 or more in the account, Principality Building Society will give notice of any reduction in interest rates at least 14 days before the change takes effect.
If £3,000 is deposited into the account when it is first opened, after 12 months the account will build up around £44.69 worth of interest.
The child will be allowed to make three withdrawals from the account every year without a fee being charged.
The building society highlighted that the action of closing the account, which can be done at any time, classes as a withdrawal.
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When the child turns 18, operation and management of the account will not pass to the child until the signatory consents to this in writing.
However, if the Account Holder is 18 or over when the Signatory dies, the operation of the Account will be automatically transferred to the named account holder.
Principality Building Society stated that it believed in the “importance” of providing children with a “strong financial education” and over the last 18 months has provided 10,000 young people with financial education lessons.
It said: “We’re passionately committed to educating school pupils across Wales and the borders.
“We want to make sure good savings habits are in every home, that’s why we’ve created the Learner Earner savings account, which both financially educates children and rewards them for reaching their savings goals.
“This monthly saver account is designed for you and for them, combining a competitive interest rate with a way to teach your family good savings behaviours.”
The comparison website MoneyFacts.co.uk’s Rachel Springall highlighted it as one of the best rates for regular savings accounts ahead of Nationwide’s Nationwide BSFlex Regular Saver which offered 1.5 percent and TSB’s Monthly Saver which offered 2 percent.
Ms Springall said: “The Learner Earner account from Principality Building Society is a great idea in principle, as it is specifically designed in order to help children to learn about saving and encourage them to get into the habit of putting money away for a rainy day.
“They can also experience going into a building society themselves and seeing the process of how to deposit their pocket money on a regular basis.”
However, Ms Springall noted that as the account can only be opened in a branch or at an agency the appeal may only extend to those within the area.
She added: “A child and an adult must both open Learner Earner accounts at the same time, and both adults and children may actually be able to secure higher rates of return elsewhere.”
