Encouraging children to have a responsible attitude to their finances by teaching them money management from an early age will help them get through life without landing in deep financial waters. This is why many parents choose to set up savings accounts for their children. There are a number of types of bank accounts aimed specifically at saving for children and like their adult counterparts these consist of fixed rate accounts, easy access accounts and regular savers. Whichever you plump for make sure you are aware of the small print as many regular savers enforce penalties for making withdrawals. You may also want to check if you can get a higher rate by heading online to banks such as Secure Trust Bank.

It’s also worth noting that while children’s accounts offer better deals than adult current accounts or savings accounts, low interest rates mean returns on even children’s savings are low. With this in mind it is well worth looking into taking advantage of the new Junior Isas to be launched on November 1^st 2011. These will be available from many of the high street banks and building societies that also offer adult Isas and will be replacing the Child Trust Fund. Savings in these accounts will of course be tax free and there will be a fixed contribution limit of £3,000.

These accounts are particularly good for parents wishing to save for their children’s time at university, or even their first car, because they will not be able to withdraw funds from their Junior Isa until they are 18. At this point you may choose to let them withdraw the funds are   move them into another savings option such as an adult Isa.

Optimistic estimates from the government predict that if parents contribute the maximum amount to the Isa fund each year a child could amass savings of up to £80,000, which represents a growth rate of 48 per cent. To find out more about plans for the new Junior Isas, see: http://www.guardian.co.uk/money/2011/mar/31/junior-isa-plans-revealed.