Yes, you can open a savings account for your daughter, but the rules depend on her age
If your daughter is under 18, you will open the account in your name as the parent or legal guardian, with her as an authorized user or beneficiary. The bank holds you responsible for the account, and you control the money until she reaches the age of majority — usually 18, though some states set it at 21. If she is 18 or older, she can open her own account without you, though you can still contribute money to it.
The specific rules vary by bank and by state. Some banks let you add a minor as a joint owner from birth; others require the child to be a certain age, often 13 or 16. A few banks offer accounts designed specifically for minors, with parental controls built in. The account type you choose affects whether your daughter can withdraw money on her own, whether the account converts automatically when she turns 18, and what happens to the money if you die.
Key Takeaways
- You open the account in your name with your daughter listed as a minor account holder, and you remain the legal owner until she reaches the age of majority in your state.
- Different banks have different minimum age requirements for minors — some allow accounts from birth, others require the child to be 13 or older.
- A custodial account or UTMA/UGMA account lets you save money for your daughter with tax advantages, but the money becomes hers legally when she turns 18 or 21.
- Most accounts designed for minors convert to standard accounts when the child reaches adulthood, and you will need to update the account ownership at that time.
- Interest rates on savings accounts for minors are typically the same as regular savings accounts, though some banks offer slightly higher rates to encourage saving.
Parent-controlled accounts versus accounts your daughter can use
A parent-controlled account is opened in your name only, with your daughter's name added as a beneficiary or authorized user. You make all deposits and withdrawals. Your daughter cannot access the money without your permission, and the account does not appear on her credit report. This setup works well if you want to save for her future without giving her control — for example, saving for college or a car.
A joint account lists both you and your daughter as owners. She can withdraw money using a debit card or at the bank, and the account may appear on her credit report depending on the bank. Joint accounts work better if you want to teach her about saving and spending, or if she needs access to money for everyday expenses. The downside is that she can spend the money without your approval once she has the card.
A custodial account (also called an UTMA or UGMA account, depending on your state) is a legal arrangement where you hold the money in trust for your daughter. You control it while she is a minor, but the money is legally hers. When she turns 18 or 21 (depending on your state and the account type), the money becomes fully hers to use however she wants — you lose control at that point. Custodial accounts have tax advantages for saving, but they can affect her financial aid if she goes to college.
What documents and information you will need
To open an account for your daughter, bring your government-issued photo ID and proof of address (a recent utility bill or lease works). You will also need your Social Security number and hers. If your daughter is old enough to come to the bank, bring her too — some banks require the minor to be present, though many do not.
If you are opening a custodial account, the bank will ask you to confirm your relationship to your daughter — usually a birth certificate or adoption papers. Have her Social Security number ready; the bank will use it to set up the account in her name. If you do not have her Social Security number yet, you can get one from the Social Security Administration using her birth certificate and your ID.
Some banks also ask about the source of the money you are depositing — whether it is your own savings, a gift from a relative, or something else. This is standard anti-money-laundering procedure and does not affect whether you can open the account.
How interest and taxes work on accounts for minors
Interest rates on savings accounts for minors are usually the same as rates for adults at the same bank. A few banks offer slightly higher rates on youth accounts to encourage saving, but the difference is typically small — often less than 0.1 percent. Shop around if interest rate matters to you, but do not expect a dramatic difference.
Taxes on the interest depend on the account type. If the account is in your name only, you pay tax on the interest. If it is a custodial account or joint account in your daughter's name, she pays tax on the interest — though if she is young and the interest is small, she may owe no tax at all. The bank will send a 1099-INT form at tax time if the interest exceeds a certain amount (currently $10).
If you are saving for college, a 529 plan offers tax advantages that a regular savings account does not — the money grows tax-free if used for college expenses. A 529 is not a bank account; it is an investment account, and the money can go into stocks or bonds as well as cash. Talk to a financial advisor or your bank about whether a 529 makes sense for your situation.
What happens when your daughter turns 18
If you opened a parent-controlled account in your name only, nothing changes automatically. The account stays in your name, and you keep control. You can choose to transfer it to her, close it, or keep it as is. There is no legal requirement to hand it over.
If you opened a joint account, your daughter now has full legal control. You can ask the bank to remove yourself as an owner, or you can leave the account as is — but she can withdraw all the money without your permission. Some parents have a conversation with their child about this before it happens.
If you opened a custodial account, the account converts to a standard account in your daughter's name when she reaches the age of majority (18 or 21, depending on your state). You lose all legal control at that point, and the money is entirely hers. The bank will notify you when this happens, and you may need to sign paperwork to transfer ownership. Check with your bank about their specific process.
Choosing a bank and account type
Large national banks like Chase, Bank of America, and Wells Fargo all offer accounts for minors, usually with no minimum balance and no monthly fee. Credit unions often have similar products and sometimes offer better rates or lower fees. Online banks like Ally and Marcus also offer accounts for minors, though you may not be able to deposit cash in person.
Before you open an account, call the bank or check their website to confirm their minimum age requirement for minors. Ask whether the account converts automatically when your daughter turns 18, or whether you need to take action. Ask about debit card options — some banks issue cards to minors, others do not. Ask whether the account earns interest and what the current rate is.
If you want to teach your daughter about money, look for a bank that offers online tools or an app where she can see her balance and track her savings. Some banks also offer financial literacy resources for teens. If you want maximum control and simplicity, a parent-controlled account at your current bank may be the easiest choice.
Special situations: guardianship, foster care, and accounts for older teens
If you are a legal guardian but not the biological parent, you can still open an account for the child in your care. Bring the guardianship papers along with your ID. The process is the same as for a parent.
If your daughter is in foster care, the state may have rules about how money for her care can be saved. Some states require foster parents to set up dedicated savings accounts for the child's future. Ask your caseworker about the requirements in your state.
If your daughter is 16 or 17 and wants her own account without you as a co-owner, some banks will let her open one with your permission. She will still need your ID and signature, but the account will be in her name only. This is less common than joint accounts, but it is worth asking about if she is older and wants independence.
Frequently Asked Questions
Can I open a savings account for my daughter if I do not have custody?
No. Only a parent, legal guardian, or custodian can open an account for a minor. If you are not listed on her birth certificate or guardianship papers, the bank will not let you open an account in her name. You can open an account in your own name and save money for her, but it will not be legally hers until you transfer it or leave it to her in a will.
What is the difference between a custodial account and a regular joint account?
In a joint account, you and your daughter are both owners, and she can withdraw money once she is old enough to use a debit card. In a custodial account, the money is legally hers but you control it until she turns 18 or 21. Custodial accounts have tax advantages and are better for long-term saving, but she gets full control when she comes of age. Joint accounts are simpler but give her access sooner.
Will opening a savings account for my daughter hurt her credit score?
No. A savings account does not appear on a credit report and does not affect credit scores. Only credit products like credit cards and loans show up on credit reports. A savings account is purely a place to store money and earn interest.
Can I remove money from my daughter's account if I need it?
If the account is in your name only, yes — it is your money. If it is a joint account, yes, but your daughter can also withdraw it. If it is a custodial account, the money is legally hers, and using it for your own expenses can be considered a violation of the trust. Talk to a lawyer if you are in a tight spot; there may be other options.
Do I need to report the account to the government?
No special report is needed just to open the account. The bank will report interest income on a 1099-INT form at tax time if it exceeds $10. If you are receiving government benefits that have income limits, a savings account in your daughter's name may not count against those limits, but a custodial account in your name might. Check with your benefits administrator if this applies to you.