25 answers

Grandma Opening Savings Account for Grandkid?

My SD's grandma wants to open a saving's account for her. I know she's trying to be helpful.

I've been after my husband to do this for his daughter for a long time. I think she should be putting some of her money in her saving's account because it's a good lesson in money for her, and then she'll be saving money toward college or trade school.

If the grandma does it, it will be at her bank (which is not OUR bank) and she will be the adult trustee. All deposits will have to go through her.

I think it's my SD's mother or father's job to do this at their own bank. I think in this case it's my husband's job since SD lives with us and if she deposits money regularly in the account it will be easier if it's at our bank and he is the trustee. Plus, although I would never say this out loud, it's not any of Grandma's business how much money SD is putting in, or how much money she is taking out. AND I don't want her to be in charge of SD's money when the time comes for her to spend it. I think that's her mother and father's business.

Plus, I still feel like it will be a pain for us to have to wait unti SD comes to visit to deposit any money. The plan I was shooting for (and hoping to get my husband on board for) is every time SD gets a lot of cash, a small portion would go to savings. Recently we've had a lot of issues with my SD not appreciating things or shopping problems with money. She went to the American Girl store with $175 and was being a brat. So I think if she gets $175, some of it should go to savings to help teach her about money and saving. She is 10.

Is this weird for a grandma to open an account? What should I say or have my husband say/do? My husband is moving so S-L-O-W on this. I think that Grandma will open an account soon, and then it will be too late. I can't say anything, it's not my place.

And if Grandma opens an account (and my husband has a thing about not hurting his mom's feelings or speaking up) then is it a bad idea to ALSO open up a different savings account at our bank under my husband's name so it's easier to make deposits?

Advice welcome!

What can I do next?

So What Happened?™

Thanks! I was only concerned because of the way Grandma brought it up to us, as if this account was to be THE savings account that her granddaughter could use. And also because she is sometimes a controlling grandma. She used to demand that my husband give up his weekend with his daughter so she could spend the weekend at grandma's (my husband finally got up the guts to tell her to stop!)

We'll let grandma do her thing. She talked to SD about the account and about how SD was going to save her money in it. Grandma's bank is a small one, 45 minutes away from us. And now that SD has a LIFE and is spending her time with her mom or dad like she should plus friends, getting out there is a pain.

And I'll talk to my husband about opening a different savings account at our bank where my SD can deposit her money regularly. I think grandma will be upset that it isn't THE account we are using, but I hope she'll see that it's okay for SD to have multiple accounts.

Featured Answers

There are so many things that just don't make any sense.

You don't state why grandma wants to open an account. Is it because hubby won't get off his but and do it, or because grandma wants to deposit money for her grandchild and help teach her grandchild important financial lessons.

You say SD lives with you, but then you say you don't want to wait until SD visits.

Where does a 10 year old get all this money that she will need to constantly be going to the bank?

A large percentage of grandparents open accounts for their grandchildren. I would NOT be concerned at all about grandma opening an account. I don't understand why you wouldn't want grandma to open an account. My FIL opened accounts for my children. Rather than being concerned, I'm extremely grateful for the fact that it'll help pay for college.

A person can have many bank accounts, so there's no reason that hubby can't open an account for her.

4 moms found this helpful

I have more than one account, don't most people? My son has more than one account and he's ony 4....

I have an account for my son at my bank and my Dad has another one for him at his credit union. I guess I don't understand what the big deal is? I LOVE that Dad opened an account for him. Where I might be tempted to dip into the account I opened for him for something fun or short term, I KNOW that my Dad has much more control and the money he puts away will always be there....

3 moms found this helpful

Well, my mom and dad have accounts in all the kids' names and so do my inlaws. My parents have education accounts, his parents have investment accounts. My grandmother bought stock for my oldest son when he was born, her first Great Grandchild.
Plus we have education accounts and the kids each have their own savings accounts.
Let Grandma do it. Have her put you on the account so you can manage it too.
I think you're stressing too much about this.

3 moms found this helpful

More Answers

I guess I don't understand why you feel there should be ONLY one account.

Let Grandma open an account for her. In California, many people do that, for instance, under the Uniform Gift to Minor Act. Many people set up these types of accounts and have "control" over them for the benefit of the beneficiary. The child.
If Grandma wants to regularly deposit money into that account to be transferred to your daughter when she comes of age to be used for college or whatever, I don't see the problem.

If you and your husband want to set up a savings account for her, just do it. I don't see why it has to be an either/or situation unless you feel that any money her grandmother gives her should go into the savings account you control.

It's been many years since I worked for a stock brokerage firm, but I can tell you that many people set up accounts for kids and grandkids in which they can deposity not only money, but stocks, etc. There used to be tax and investment advantages and that's why many wealthy people were doing it.

Just have two separate accounts. For the life of me, I'm not sure why you would consider telling the Grandmother she can't open an account for her granddaughter. Lots of grandparents do it.

It will NEVER be too late for you to open an account for your step daughter at your own bank.

Just my opinion.

4 moms found this helpful

There are so many things that just don't make any sense.

You don't state why grandma wants to open an account. Is it because hubby won't get off his but and do it, or because grandma wants to deposit money for her grandchild and help teach her grandchild important financial lessons.

You say SD lives with you, but then you say you don't want to wait until SD visits.

Where does a 10 year old get all this money that she will need to constantly be going to the bank?

A large percentage of grandparents open accounts for their grandchildren. I would NOT be concerned at all about grandma opening an account. I don't understand why you wouldn't want grandma to open an account. My FIL opened accounts for my children. Rather than being concerned, I'm extremely grateful for the fact that it'll help pay for college.

A person can have many bank accounts, so there's no reason that hubby can't open an account for her.

4 moms found this helpful

my Mom opened accounts for all of her grandchildren. She placed $$ in each acct for both birthdays & Christmas. So far, 4 out of 5 of the kids have used the accts to pay for their 1st cars....which then, in turn, allowed them to work & learn to save $$ too. My 15yo worked last summer & doubled his $$.

When they were little, they didn't get it. By teen years, they were all for it. & the ones who are much older....still appreciate what Gma did for them!

Oh, & we were also placed on the accts so that we could easily access them.....

3 moms found this helpful

I think you hit on the perfect solution at the end of your post. Yes, your husband should still plan on opening a seperate savings account for his daughter. Grandma can feel free to open a savings account if she wishes, but that doesn't obligate granddaughter to use that one only. My mom opened a savings account for my kids, but I don't contribute to it, and she doesn't expect me to. That account is for the money to stay in until the kids go to college. The savings accounts I opened for my kids are for them to have access to so they can learn to handle their own money, once they are old enough.

3 moms found this helpful

Ok, well first of all, you're out of this and you know that.

Second, my sons grandparents have each opened savings accounts for my son, they are accounts that the grandparents periodically deposit money into (for Christmas and birthdays). It is intended to be a long term savings account for something like a car or college or something significant down the line.

So, in conclusion she can have multiple savings accounts if your husband ever decides to open one for her--if he doesn't then she can have one that she may or may not contribute towards. You should have him say/do nothing about it aside from "thank you" to the grandmother, and honestly you really cannot have anything to do with or say about how her money gets saved.

Having differences of opinions in parenting is bad enough, having differences of opinion in parenting and money is a minefield you'd be WELL advised to avoid altogether.

3 moms found this helpful

I have more than one account, don't most people? My son has more than one account and he's ony 4....

I have an account for my son at my bank and my Dad has another one for him at his credit union. I guess I don't understand what the big deal is? I LOVE that Dad opened an account for him. Where I might be tempted to dip into the account I opened for him for something fun or short term, I KNOW that my Dad has much more control and the money he puts away will always be there....

3 moms found this helpful

Well, my mom and dad have accounts in all the kids' names and so do my inlaws. My parents have education accounts, his parents have investment accounts. My grandmother bought stock for my oldest son when he was born, her first Great Grandchild.
Plus we have education accounts and the kids each have their own savings accounts.
Let Grandma do it. Have her put you on the account so you can manage it too.
I think you're stressing too much about this.

3 moms found this helpful

You could have the grandma open a 529 account. It can be used only for school and she can have access to it and contol it. It grows tax free until it is needed (and could be used for private elementary school, etc). She can designate someone to inherit the control of it when she passes. My mil did this and my husband will get control of it when she passes. She contributes money to it yearly. She lives in illinois and you don't have to use your state's 529 (all states have 529). Pick one that has low fees and moves stuff automatically (lowers the risk) as your daughter gets older and closer to college (where most likely the money will be used).

2 moms found this helpful

Let grammy open an account at her bank. In the meantime, open a little no-frills savings account at your bank. Let her make her deposits there and once you get a few hundred bucks withdraw and give to grandma to deposit in her bank.

ANY chance your inlaws would open a 529 plan for her that they could contribute to in lieu of gifts for every little occasion?

2 moms found this helpful

Grandparents open accounts all the time for their grandchildren, it's very common. Usually though, it is a cd or college fund contribution like a 529 account instead. Your daughter can still have her bank account with her dad, and a secondary account with grandma too. I've had a savings/checking account since I was 9 years old.

2 moms found this helpful

My mom and ex-mom-in-law did this for both my kids. I think it's a nice thing. Your husband can open an account too. Don't get upset about this. It's not a big deal.

2 moms found this helpful

I'm not sure I understand why this is an issue. Grandma's account for SD and husband's account for SD are two different issues. SD can learn to save HER money through the account daddy opened. The daddy/SD account is yours/daddy's to control.

Grandma can put her own money into the account for SD. If she wants to control that money, it's hers to control. You don't have to make any deposits into grandma's account - it's hers for your SD.

2 moms found this helpful

Let Grandma open an account for her, that is fine. However open an account for her locally. She then needs to be taught that when she receives a monetary gift that she is to save a certain percentage, she can spend a certain percentage and then decide how much is appropriate to donate to a charity of her choice. By doing this you will teach her the beginnings of budgeting, which sadly as obvious by people who bought too much in past 15 years and got way over their head and had no backup plan did not know. The monies I include in this also include if my child gets a giftcard for a certain store, she then decides on how much she will spend on herself and gets something to donate. Ex: Target giftcard for 20.00. She got herself a skirt she wanted and then got canned veggies and took them to the food pantry. She also removed 5.00 from her piggy bank and deposited in the bank for her savings....so proud that she is getting this concept.

2 moms found this helpful

tell grandma thanks. sd will appreciate it. and leave it at that. get an account close to home that the kid can use as she needs and put whatever she wants to in the other account. a grandparent really has no say in how much / little goes into the account.

1 mom found this helpful

Can grandma just open the account and be the one to put money in it from herself and you/hubby/daughter open one for her where daughter does the deposits/withdrawls along with you? That way grandma can put in what she wants when she wants and turn it over to daughter when she is 18. The one you open can be more versatile for putting in and taking out according to your schedules and when daughter gets or needs money. Use grandma's for a nest egg and yours for lessons/education like you said. Just let grandma open one and don't think of it until daughter is 18.

1 mom found this helpful

I tried to read as quickly as I could, and I do hope I understand.

But must ask you, what is the worse that could happen?

1 mom found this helpful

You can deposit money into the account regardless of the primary account-holder's name. My dad opened accounts for both of my girls at his bank, and we are able to make deposits into the accounts without any issues. He set it up for the "educational enrichment" of the girls, and it has been really helpful for paying for some important extras for them. I think it's a great idea. The other thing is, you can set up more than one account for your SD. One at your MIL's bank, one at your bank. No big deal. :)

1 mom found this helpful

Is there are reason you BOTH can't open an account? The grandmother's account could be one where the money always stays in. The one you open could be one where she can take out, if she wants to.

1 mom found this helpful

My parents opened up savings accounts for my boys for Christmas through Navy Federal Credit Union. The monies deposited DO NOT go through my parents. It's THEIR account. He is the "adult" listed on it - just as I am.

My kids are 9 & 11. Kids MUST learn how to save money. We had accounts for them at USAA but since they didn't have a local branch - it made the concept hard on my kids. Now? they can take their allowance in and deposit themselves....

Only open ONE account. Don't have multiples. ONE ACCOUNT.

1 mom found this helpful

I think it is wonderful that a Grandmother wants to open a savings account for a Grandchild and help that child save money. Why on earth would you not allow that... she is is not trying to come in and run your life. Also if Grandmother is making deposits to an account she opened yes it is her right to know what is in it.

Gees, if you want a bank closer to you and one you control then have another savings account closer to you so SD can use that bank and you get control.

Sounds like there is a bigger issue here than Grandmother opening a savings account for a grandchild.

1 mom found this helpful

I think it is wonderful for grandma to do this. It is her account she is putting money in that will some day go to your SD. It is not your account in any way, therefore you should have no management of it. It is there for a later date, such as when the girl needs something in the future. The girl should have her own teaching tools at home. This account has nothing to do with you or hubby. It is between grandma and the SD.

1 mom found this helpful

I see your SWH but still wanted to comment. We opened a savings account for our daughter while I was still on maternity leave. When my MIL decided to open an account for the older granddaughter (after her parents split and to insure the mom did not have any claim or access to it) at HER bank, she opened one for our daughter. She didn't want to open for one and not the other (which is nice) but the other one didn't already have an account so it wasn't quite the same situation.

I could really care less except that 1. we already had an account and wondered why it couldn't be deposited into it, 2. I hate that bank (we've had problems before and closed our account and they have been in financial trouble and were recently bought out), and 3. I had to tell her to correct her name so down the road we didn't have a problem (our daughter goes by her middle name and my MIL opened it in that name rather than her legal name).

We don't plan to use her account but it is there for her if grandma wants to add to it.

My parents have not only opend a savings account at their bank for our son they have also started a 529 and taken out a life insurance policy. My DH and I are fine with this, instead of them just giving him toys and clothes for bdays and Christmas they will be helping build his savings for college. DH and I have also opened a savings account for him at our bank and all money that goes into ds piggy bank goes into it as well as money he gets from the sale of his calves each year. I really don't see what the big deal is. If grandma wants to open an account for her granddaughter and contribute to it as well then there should not be an issue. The money that my parents are putting in for my son will not be available to him until he is ready for college ect so the fact that dh and I won't have access to it is not an issue either.

The account should be in the grandmother's name, the father's name and the daughter's name - that way your hubby can make deposits and access the account also.

Tho' I know that at my bank anyone can a deposit off for me if they have the account number and a deposit slip filled out - the banks will always take money.

Without reading any of the comments, here is my 2c!

My great-grandparents opened many accounts for me at various banks when I was very young, as well as purchased CD's. Why so many? They were still reeling from the depression era and didn't trust enough to put all of their eggs in one basket, so to speak. All of them were local banks and anyone could deposit money, so that was never a big deal- they didn't have to be present or anything. (I'm pretty sure you can deposit as long as you have the acct # to any acct, you just can't withdraw or make changes.)

The CD's were the ones that gained me the most interest and couldn't be cashed in until I was an "adult" at 18/19 yrs old. These are your best investment if you're looking to put money in long-term.

It's not going to do any harm to have multiple accounts for her. You could even set the one from Grandma up as her "college fund" or "car fund" and the one for her as something you will match portions of, etc and she can withdraw from occasionally, etc. So that each acct has different rules for her, just like adults do!

The only snafu with mine was that my great-grandparents died long before any of my CD's matured or my parents allowed me to withdraw from the savings, so it was a little bit of a pain in the butt to have to go to the bank with the executor of their estate, documents of their death certificates, etc. and close out the accounts. It was worth it though- it really made me appreciate (even as a spoiled brat of 18 yrs old!) that someone cared enough to put money aside for my future.

One thing I might suggest is that you don't tell her the amounts that are in bigger accounts. I spent many days dreaming of how I would blow the cash already there instead of saving my own money and thinking about my goals realistically. I also wish I had not had access to the money until, say, 25. I really wasn't mature enough at 18 to handle access to the accounts and, on a personal note, ended up in a bad marriage at 21 where he found out about the biggest (yet untouched) account and spent the entire amount (which was to be for college) behind my back, and got away with it since we were legally wed. Of course this could have happened to me at any age, but I think if I had had a few more years to get my life together before having that access, it would have been less likely. Just some thoughts!

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