Kids can have bank accounts, but the account type depends on their age and what you want it to do

A child under 18 can hold a bank account in their own name, but not alone. A parent or legal guardian must open it with them and remain on the account as a co-owner or custodian. The bank treats the child as the account owner for tax purposes, but the adult has full access and control until the child reaches the age of majority — usually 18, sometimes 21 depending on the state and the bank's rules.

The main types are a custodial account (where the adult is the custodian and the account transfers to the child at a set age) and a joint account (where both names appear on the account and both can withdraw money at any time). Some banks also offer accounts marketed as "teen accounts" or "student accounts," which are joint accounts with restrictions built in — like spending limits or parental controls — but the legal structure is the same.

What matters most is matching the account type to what you're trying to accomplish: teaching a child to save, holding money safely until they're older, or giving them access to spend with oversight.

Key Takeaways

  • A parent or guardian must open the account with the child and remain on it; children cannot open accounts alone.
  • Custodial accounts transfer to the child at a set age (often 18 or 21), while joint accounts stay under parental control until you remove the child's name.
  • Most banks require the child to be at least 13 to have a debit card, though some allow younger children with parental approval.
  • Money in a custodial account counts as the child's income for tax purposes if it earns interest, but joint accounts are treated as the parent's money for taxes.
  • The adult on the account can withdraw all the money at any time, so these accounts are not legally protected from creditors or the adult's debts.

Custodial accounts versus joint accounts: what transfers and what doesn't

A custodial account is opened under a state's Uniform Transfers to Minors Act (UTMA) or Uniform Gifts to Minors Act (UGMA). The parent is the custodian, and the child is the beneficiary. When the child reaches the age of majority in that state — 18 in most places, 21 in a few — the account automatically becomes theirs to control. They get the debit card, the login, the ability to withdraw or spend without asking. The money is legally theirs from the moment it goes in; the custodian just manages it until they're old enough.

A joint account has both names on it from the start. The parent can withdraw money, make transfers, and manage the account just as they would their own. When the child turns 18, the account does not automatically change hands. It stays a joint account unless the parent removes the child's name or closes it. The parent keeps control unless they actively hand it over.

The tax difference matters if the account earns interest. Money in a custodial account is the child's income, so if interest exceeds a certain threshold (currently $1,300 per year, though this changes annually), the child may owe taxes on it. Money in a joint account is treated as the parent's income for tax purposes, so interest does not trigger a separate tax filing for the child.

Choose a custodial account if you want the money to belong to the child and transfer to them automatically at a set age. Choose a joint account if you want to keep control and decide later whether to hand it over.

What banks require to open an account for a child

You will need to bring the child to the bank in person, or some banks allow you to open an account online if you have a valid ID and the child's Social Security number. The bank will ask for:

  • Your government-issued ID (driver's license or passport)
  • The child's Social Security number
  • Proof of address (a recent utility bill or lease in your name)
  • The child's birth certificate (some banks ask for this, others do not)

If the child is old enough to come to the branch, bring them. Some banks require it; others prefer it because it makes the process faster. If you are opening the account online, you will typically upload photos of your ID and the child's Social Security card.

The minimum deposit varies by bank and account type. Some banks have no minimum; others require $25 to $100 to open. Ask about this before you go, because it affects whether you can open the account that day.

Debit cards, spending limits, and parental controls

Most banks will not issue a debit card to a child under 13, even if the account is open. At 13, many banks allow a debit card if the parent requests it. Some "teen accounts" lower this to age 10 or 11, but these are less common.

Once a debit card is issued, the child can use it to withdraw cash, make purchases online, and pay at stores. The parent's access depends on the account type. On a joint account, the parent can see all transactions and set spending limits through the bank's app or online portal. On a custodial account, the parent can also see transactions, but once the account transfers to the child, the parent loses access entirely.

Parental controls vary by bank. Some let you set a daily spending limit, block certain types of transactions (like online purchases), or require approval for withdrawals over a certain amount. Others offer none of these features. If oversight is important to you, ask the bank what controls are available before you open the account.

What happens to the account when the child turns 18

If it is a custodial account, the account becomes the child's on their 18th birthday (or 21st, depending on your state). The bank sends a notice before this happens. The child can then log in, change the password, and manage the money without the parent's involvement. The parent's name stays on the account, but they no longer have the legal right to withdraw money or make changes.

If it is a joint account, nothing changes automatically. The account stays joint. The parent can remove the child's name, close the account, or leave it as is. Some parents leave joint accounts open so they can continue to monitor spending or help manage money. Others close them to give the child full independence.

Some banks require you to convert a custodial account to a regular adult account once the child reaches the age of majority. This is usually a straightforward form you fill out at the branch or online. Ask the bank what their process is when you open the account, so you are not surprised later.

Tax reporting and how it affects your taxes

If the account is custodial and earns interest, the child may need to file a tax return. The bank will send a 1099-INT form showing the interest earned. If the interest is under $1,300 per year (the threshold changes annually), the child typically does not owe taxes on it, but they may still need to file to claim a refund if taxes were withheld. If interest exceeds $1,300, the child owes taxes on the amount above that threshold, usually at their own tax rate, which is often lower than the parent's.

If the account is joint, the interest is reported as the parent's income on the parent's tax return. The child does not file separately for this money.

If the child has earned income (from a job, for example) and deposits it into a custodial account, that income is also the child's for tax purposes. The child may need to file a return depending on how much they earned.

Talk to a tax professional if the account will hold a large amount of money or if the child has other income. The rules are different for each situation, and a few minutes of information can save you from filing incorrectly.

Risks and limits of accounts in a child's name

Money in a custodial or joint account in a child's name is not protected from the parent's creditors or debts. If the parent faces a lawsuit, tax lien, or bankruptcy, the money in the account can be seized to pay those debts. This is one reason some parents keep a child's money in their own account instead, though that creates other problems (the money is not legally the child's, and it can complicate financial aid for college).

The account also counts as the child's asset if they later explore for financial aid for college. Schools use the Free process for Federal Student Aid (FAFSA) to determine aid, and assets in the student's name reduce the amount of aid they receive. Assets in the parent's name have less impact on aid may be able to access. This is a real trade-off to consider if college is years away.

Once a custodial account transfers to the child at age 18 or 21, the parent has no legal claim to the money, even if the parent contributed all of it. The money belongs to the child, and they can spend it however they want. If you are saving for a specific purpose (like college), make that clear to the child before the account transfers, but understand that you cannot force them to use it that way.

Frequently Asked Questions

Can a child open a bank account without a parent?

No. A child under 18 must have a parent or legal guardian on the account. The adult must be present to open it and remains on it as a co-owner or custodian. Some banks allow teens 16 and older to open accounts with reduced parental involvement, but a parent or guardian must still authorize it.

What is the difference between a custodial account and a trust account?

A custodial account is simpler and faster to open — it requires only the parent and child's information. A trust account is a formal legal document that names a trustee to manage money for the child and can include detailed instructions about when and how the child receives the money. Trusts are more expensive to set up and are usually used for larger amounts of money or more complex situations.

Does money in a child's account count against financial aid for college?

Yes. Money in a custodial account in the child's name reduces the amount of federal student aid they may receive. Money in a joint account or in the parent's name alone has less impact. If college is in your plans, talk to a financial aid advisor about the best way to save.

What happens if the parent dies?

If the parent is the custodian of a custodial account, the account transfers to the child at the age set by state law (usually 18 or 21), regardless of the parent's death. If it is a joint account, the account typically becomes the child's sole account, though the exact process depends on the bank and state law. The child may need to bring a death certificate to the bank to update the account.

Can a child have more than one bank account?

Yes. A child can have a savings account at one bank and a checking account at another, or multiple accounts at the same bank. There is no legal limit. Having more than one account can help organize money for different goals, but it also means more accounts to monitor and more statements to track.