Skip to main content

Junior bank accounts

IF YOU’RE one of those who started a bank account when you were 18 and about to leave home for college, refrain from passing on this piece of information to a young person if you want to protect your dignity. Otherwise, be prepared to see the smirk and hear the condescending tone of a four-feet something person, elaborate on how he/ she was exposed to banking at the age of 10.

Exposure comes early these days. Kids aren’t content with paper money or being the banker in a game of Monopoly. They want to be a part of the real financial system and enjoy the benefits that their parent’s have- like having an account of their own, using an ATM card to withdraw cash, having a debit card to occasionally go shopping and so on. Most banks in India now provide the opportunity to start a savings account in a child’s name.

KNOW THE BASICS

Junior accounts in most banks are available for children up to 18 years of age. However, the minimum age to start such an account could be as low as one day. Before going any further, it must be clarified that while this may be in the child’s name, operating this account is possible only under the guardianship of a parent or a legal guardian. While the parents may ask for a particular amount to be diverted to this account on a steady basis, children also have the opportunity to depositing their savings into this account. Depending upon the bank, a minimum balance may also have to be maintained.

WEIGH THE BENEFITS

Starting such an account is not just about providing your child a source of cash and making him/her feel good. The attempt is to ingratiate the child into learning how the financial system works and to inculcate a sense of discipline especially when it comes to using ATM and debit cards. The child also inculcates the habit of savings and budgeting, by ensuring that surplus money they receive through various sources like pocket money, gifts, scholarships etc is deposited in their bank account. Moreover, it also gives children, particularly those in middle school, to practically understand the concept such as interest. For parents, this is also seen as a way of building up a cash store not just to deal with your child’s current needs but also for the future needs. This also ensures that a steady income is diverted on a regular basis.

EXERT PARENTAL CONTROL

To prevent parents from worrying about the misuse of money and cards, banks provide parents/guardians with scope to exert a great deal of parental control over a children’s account. It is predominantly up to the parent whether he/she wants an ATM or debit card to be issued. Even when such cards are issued, the bank allows the parent to determine limits regarding the amounts that can be withdrawn using an ATM or spent using a debit card. Moreover, for any transactions done using cheques, the signature of the guardian on the cheque is essential. The passwords necessary to conduct transactions online or over the phone are also given to the guardian and they are encouraged not to divulge these readily to their children. Apart from sending a quarterly physical statement or a monthly e-mail statement to the parents, the bank also sends free SMS/e-mail alerts to parents if the transactions conducted by the child crosses the threshold level.

CHECK OUT THE BENEFITS

In some banks, there are certain benefits that you are offered if you have a children’s account. HDFC’s Kids Advantage Plan offers free education insurance cover of about Rs 1,00,000 in the event of the parent’s death in a vehicular accident. Also, when the funds in the account exceed or reach a particular amount, then the bank automatically transfers some part of it into a fixed or term deposit.

STEP BY STEP

  • To start such an account, you will need documents which prove the child’s date of birth
  • The guardian also needs to submit documents to prove his identity, address and his relationship with the child

There are specific accounts which can be operated by children alone but the age and the mode of transaction varies from bank to bank. At Punjab National Bank, students above the age of 10 can open zero-balance accounts and are given both ATM cards and cheque books. However, at HDFC, the self-operated account for minors is available for children above 12 but the minor will be forced to conduct all transactions at a bank branch.

Popular posts from this blog

SBI Magnum Tax Gain Scheme 1993 Applcation Form

    https://sites.google.com/site/mutualfundapplications/tax-saving-mutual-funds-elss     Investment Details Basics Min Investment (Rs) 500 Subsequent Investment (Rs) 500 Min Withdrawal (Rs) -- Min Balance -- Pricing Method Forward Purchase Cut-off Time (hrs) 15 Redemption Cut-off Time (hrs) 15 Redemption Time (days) -- Lock-in 1095 days Cheque Writing -- Systematic Investment Plan SIP Yes Initial Investment (Rs) -- Additional Investment (Rs) 500 No of Cheques 12 Note Monthly investment of Rs 1000 for 6 months and quarterly investment of Rs 1500 for 4 quarters.

Birla Sun Life Tax Plan Online

Invest Birla Sun Life Tax Plan Online   An Open-ended Equity Linked Savings Scheme (ELSS) with the objective to achieve long-term growth of capital along with income tax relief for investment.   After a bad patch from 2008 to 2010, Birla Sun Life Tax Plan has made a big comeback in the last five years, with a particularly good run since 2014. The fund's rankings, which had slipped to two stars in 2011-12, recovered sharply to three-four stars in the last three years. The fund has delivered a particularly large outperformance over its benchmark and peers in the last couple of years. The fund's investment strategy focuses on a diversified and high-quality portfolio, with parameters such as capital ratios and balance-sheet strength used to judge quality. It uses a combination of top-down and bottom-up approaches to take sector/stock positions. The fund avoids highly leveraged plays. Staying more or less fully invested at all times, the fund parks roughly half of its portfoli

Should you Roll Over 1 year Fixed Maturity Plans?

The period between January and March typically sees an uptick in the launch of fixed maturity plans, or FMPs. Not this year. Instead, fund houses are busy rolling over or extending the tenure of their one- year FMPs launched last year to three years. Investors in one- year FMPs have a choice. Either redeem units or roll over to three years. If you exit now, your gains will be added to your income and taxed in line with your individual slab rate of 10, 20 or 30 per cent. If you stay invested for two more years, you pay 20 per cent tax with indexation benefit. Yields have softened in the past few months on expectations of a rate cut. If the central bank continues its soft monetary stance, yields are likely to fall further. In such a scenario, it makes sense for investors, particularly those in the 30 per cent tax bracket, to roll over their investments and lock in at a higher yield now. In a surprise move, the Reserve Bank of India cut repo rate by 25 basis

Mutual Fund Review: IDFC Premier Equity Fund

  IDFC Premier Equity Fund, which falls under the presumed high risk group of mid- and small-cap schemes, can rely on astute and timely equity picks. These make it less vulnerable to fluctuations compared with others in the category   IDFC Premier Equity Fund is designed to invest in upcoming, but promising businesses available at cheap valuations, and hold on to these businesses until they reap desired returns. The experiment has been successful so far, and IDFC Premier Equity has emerged as one of the top performing mutual fund schemes in the mid- and smallcap category of equity schemes.    While the scheme is an open-ended equity fund, i.e. open for subscriptions throughout the year, it has a unique philosophy to limit fresh inflows. Thus, while an investor can always take the systematic investment plan ( SIP ) route to invest in the scheme throughout the year, inflows through a lumpsum investment have been restricted. Since inception, IDFC Premier Equity has been opened for l

IDFC Premier Equity Fund dividend

  IDFC Mutual Fund   has announced dividend under the dividend option of   IDFC Premier Equity Fund Direct-D . The quantum of dividend shall be   R 4.3464 per unit.   The record date has been fixed as May 06, 2015. Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015 1. ICICI Prudential Tax Plan 2. Reliance Tax Saver (ELSS) Fund 3. HDFC TaxSaver 4. DSP BlackRock Tax Saver Fund 5. Religare Tax Plan 6. Franklin India TaxShield 7. Canara Robeco Equity Tax Saver 8. IDFC Tax Advantage (ELSS) Fund 9. Axis Tax Saver Fund 10. BNP Paribas Long Term Equity Fund You can invest Rs 1,50,000 and Save Tax under Section 80C by investing in Mutual Funds Invest in Tax Saver Mutual Funds Online - Invest Online Download Application Forms For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call --------------------------------------------- Leave your comment with mail ID and we will answer them OR You can write to us at PrajnaCapital [at] Gmail [dot]
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now