From the time the tooth fairy first shows up in your child’s life, it’s time to start teaching them how to manage their money for themselves. Saving and spending wisely is a habit that’s best started young. That’s where school banking comes in.
School Banking teaches children valuable financial literacy skills that will last well beyond their 12 long years of schooling. This year for your kid’s birthday, don’t get them a BB-8 Droid – get them a School Banking account.
Starting early with teaching children about money – and doing it in a simple and fun way – is essential. A lack of knowledge about how to budget, or what compound interest really means, can lead to poor financial decisions later on in life. You’ll soon discover financial literacy is a journey that is constantly evolving as your kids grow older and are able to understand more.
What is school banking?
School banking programs are a fun, interactive and engaging way for young Kiwis to learn about money and develop good savings habits in primary and sometimes secondary school. The idea of kids banking their savings in a comfortable learning environment surrounded by their friends can set them up in a regular savings regime that will form the basis in managing their finances.
Generally, School Banking runs all the way through primary school and sometimes through secondary schooling as well.
How does it work?
School banking involves setting up a savings account with a passbook through the provider of the service at the particular school. On school banking day every week, the kids simply deposit money through a simple system of deposit envelopes and a dropbox or intranet service provided at the school.
Banking at school means busy Mums and Dads don’t have to schedule a regular trip to a branch on behalf of their children.
The kids are taught the fundamentals of money through easy, fun exercises that often involve specially created characters or costumes. The kids receive rewards for taking part in the program and for saving up for whatever it is that they want to buy.
Benefits of school banking for schools
From a school’s perspective, a school banking program is an important fundraising opportunity. Schools typically receive a commission from the bank based on the number of savings accounts opened, as well as a percentage of overall deposits. Schools can even receive a school grant from the bank providing the program.
What resources are provided?
While the bank involved usually provides dedicated account managers to carry out the program, teachers and parents also help out by filling in the gaps and acting as school banking co-ordinators.
For those engaged in regular savings behaviour, incentives are usually provided in the form of certificates, money boxes, and vouchers.
There are also educational workshops offered in schools that do not have a school banking program. Westpac offers education workshops in 101 schools. Parents can accompany their child to a branch to open a children’s account.
Who offers School Banking Programs?
Currently, there are two institutions that offer school banking programs in New Zealand: ASB and ANZ. ASB and ANZ have a different “school set”, so the institution you choose may well depend on your child’s school:
- ASB: 722 schools participating in school banking program
- ANZ: 150 schools participating in school banking program
ASB has a total of 722 number of schools that participate in its school banking program, with 11 dedicated account managers that run the program in schools.
School banking services are available to all schools through ASB’s school banking. Services available to students participating in the program include:
- Money collection completed weekly
- Making deposits at school
- Opening accounts at school
- Certificates given to regular savers each school term
Other services that are available through school banking but not offered by ASB include:
- Account enquiries at school
- Reward programs
- Goal rewards
- Rewards may include money box, vouchers and certificates
But wait – there’s more!
We don’t just rate school banking programs. We also research and rate institutions for their support in financial education, workshops available and product offerings for Junior Banking and Youth Banking every year for CANSTAR’s Awards. In 2016, your kids have got several different options to choose from:
- ASB Bank
- Bank of New Zealand (BNZ)
- TSB Bank
Have a look at the CANSTAR Award report and see if your kids can’t find an outstanding value Junior Banking or Youth Banking savings and transaction account. Help them sign up for an account and get them started on the road to future financial freedom.