Eyes on the future: Megan Evans with Toby, 8, and Liam, 12.

Eyes on the future: Megan Evans with Toby, 8, and Liam, 12. Photo: Fiona Morris

There are many surprise lessons to learn in personal finance and, if children's bank account offerings are anything to go by, the banks are making sure customers learn them young.

Consumer group Choice analysed 26 children's bank accounts offered by big banks and credit unions and were shocked by the $25 minimum monthly deposit required by one, the $20 fee for in-branch withdrawals by another and savage interest rate cuts by a host of others.

“From online transfer fees, own-ATM fees, branch withdrawal fees and the particularly mean coin counting fee, many institutions seem very happy to raid your child’s piggy banks,” said spokesman Tom Godfrey.

When young ANZ, Commonwealth and Westpac account holders reached their savings goals and made withdrawals, the big banks dropped interest rates to as low as 0.01 per cent for that month, he said.

“Then there’s the bonus culture, with bonus interest only paid to those fortunate kids who can afford to make a deposit each month," said Mr Godfrey, referring to Suncorp and Bankwest that enforced minimum monthly deposits of $20 and $25 respectively.

Choice deemed Bankwest's Kids’ Bonus Saver and Credit Union of Australia's Youth eSaver the worst of the offerings.

While Bankwest offered the most generous interest rate of 5.75 per cent, after a year the money, except $1, was swept into another account with a "lowly" 1 per cent interest rate for amounts up to $2999. And each month the child had to deposit at least $25.

A Bankwest spokesman said the fact the funds were moved to another account was clearly stated up front.

“It’s been explicitly designed as a savings account encouraging good savings habits," he said. "This package of children’s products is one of the most generous across the industry ... and has been awarded Money magazine's Best Kids' Savings Account for eight years in a row.''

Choice also criticised CUA's Youth eSaver for a $20 fee on account holders who made a withdrawal at a branch.

CUA’s general manager of products and marketing Jason Murray said the fee reflected the online nature of the account. He also said the bank would no longer allow in-branch withdrawals from September, and therefore wipe the fee.

"It appears [Choice] is focusing on the $20 fee ... They are ignoring the other fantastic features of the product, including the highly competitive interest rate," he said.

Choice said Commonwealth's Youth Saver Account was the best option as it was linked to an educational program, the rewards relied on the number of deposits rather than amount, there were no fees and no minimum monthly payments required.

But founder of The Money Mentor Way Nicole Pedersen-McKinnon said consumers should be wary of the big banks' interest in making the most competitive offerings.

“Lifetime loyalty to a big bank costs the average Australian an extra $85,000, based on the average mortgage, personal loan and credit card debt,” she said. “Big banks pretty much never offer the best rates on products once you’re no longer a child and are hoping customers won over early will stick around regardless.”

TIPS FOR PARENTS (source: Choice)

-         Don’t get sucked in by the best interest rate

-         Make sure the conditions suit you and your child

-         Look for a bank offering face-to-face banking experience

-         Look for an account with no fees and no monthly minimum deposit for bonus interest