There’s no NZ equivalent to the UK Junior ISA or the Australian dedicated children’s investment account structure. But there are several options, each with different tax, flexibility, and growth implications. Here’s how they compare.
The main options are a bank savings account in the child's name, KiwiSaver for children, or a managed fund or index fund in your own name earmarked for your child (platforms include InvestNow, Kernel and Sharesies). An index fund in your own name is more flexible than KiwiSaver and has higher growth potential than a bank savings account, with more ups and downs along the way. KiwiSaver for children is available but has no employer contributions until employment; it's mainly useful for teaching saving habits. There's no special tax advantage to saving in a child's name in NZ: income is attributed to the parent if funds are provided by the parent.
Option 1: Bank Savings Account in Child’s Name
The simplest and most widely used option. Most NZ banks offer children’s savings accounts:
| Bank | Account name | Interest rate (indicative) | Features |
|---|---|---|---|
| ANZ | Grow | ~3.0–4.0% | No fees; online access |
| ASB | Headstart | ~3.5% | Includes piggybank feature |
| BNZ | Rapid Save (minor) | ~3.0–4.0% | |
| Kiwibank | Kids Account | ~3.5% | Visual saving goals |
| Westpac | Kidstart | ~3.5% | Online tools for kids |
Pros: Simple. Child can see their balance. Teaching tool for saving habits.
Cons: Low real returns after inflation. No compounding growth beyond interest. NZ bank savings accounts have real returns of approximately 0–1% after inflation and tax.
Tax note: Income earned in a minor’s savings account is attributed to the parent for tax purposes if the funds originated from the parent. IRD’s attributing rule means the parent reports interest income, not the child. If the child earned the money themselves (gifts, odd jobs), the income is the child’s.
Option 2: KiwiSaver for Children
Children can join KiwiSaver at any age — there’s no minimum age.
How it works:
- Parent sets up a KiwiSaver account for the child with a provider (e.g., Booster, Fisher Funds, Milford, Simplicity)
- Contributions can be made by parents (or as gifts)
- No employer contributions until the child is employed
- No government contribution until age 16 (the qualifying age dropped from 18 to 16 alongside the 2025 rate change)
- Child retains control at 18
- Can be used for first home purchase (if eligible) or retirement
Examples of providers that accept children (alphabetical):
- Fisher Funds
- Kernel: fees of ~0.25%, global index approach
- Simplicity: flat 0.23% p.a. fee from 1 October 2026 (0.24% from 1 September 2025, 0.25% before that), no member fee, growth fund available
Pros: Genuine long-term investment growth. Low-fee growth fund started at birth = 65 years of compounding. Builds a KiwiSaver history for the child.
Cons: Locked in until retirement (age 65) or first home use. No flexibility if the child needs the money for education, travel, or other goals before 65.
In short: Suited to long-term savings where flexibility isn’t needed, because the money is locked in.
Option 3: Managed Fund or Index Fund (In Parent’s Name)
Of the options on this page, this one combines high flexibility with high growth potential. The account is in your own name and you earmark it for your child.
NZ platforms:
| Platform | Minimum investment | Annual fee |
|---|---|---|
| InvestNow | $250 initial | 0% platform fee (fund fees apply) |
| Kernel | $1 | ~0.25% p.a. |
| Sharesies | $1 | ~0.5% transaction |
| Smart | $50/month | ~0.5% |
Example: Invest $100/month at 8% average return from birth to 18 = approximately $52,000 at age 18.
Pros:
- Full flexibility — money can be used for anything (university, first car, travel, house deposit)
- Investment in growth assets with meaningful real returns
- No lock-in period
- Low fees on index funds
Cons:
- Account is legally yours (not the child’s) — requires trust and clarity of intent
- Subject to your marginal tax rate or PIE rate (typically 28% for FIF income)
- If you hit financial difficulty, these funds are legally available to creditors
Option 4: Index Fund / Managed Fund in Child’s Name
A managed fund account held by a minor, with a parent as trustee.
Some platforms allow this:
- InvestNow: check current terms for minors
- Kernel: primarily adult accounts; check for minor provisions
- Sharesies: allows accounts for under-18s (requires a parent/guardian account)
Tax: Once the child turns 16, income may be taxed at their own (lower) rate. Under 16, still attributed to parent.
Option 5: Term Deposits in Child’s Name
For shorter-term savings goals (2–5 years), term deposits offer predictable returns and are simple to manage.
- Typical rate (1-year TD, as at September 2026): ~4.0–4.7%
- After tax (child’s rate if they have own income or 10.5% if very low income): ~3.6–4.2%
- After inflation: Real return varies with the inflation rate at the time — check current CPI
Better than an on-call savings account, but lower long-term growth than equity index funds.
Option Comparison Table
| Option | Growth potential | Flexibility | Complexity | Commonly used for |
|---|---|---|---|---|
| Bank savings account | Low | High | Very low | Teaching habits, short term |
| KiwiSaver (for child) | High (growth fund) | Very low (locked in) | Low | Long-term retirement head start |
| Index fund (parent’s name) | High | High | Low | Flexible long-term savings |
| Index fund (child’s name) | High | Medium | Medium | Giving child ownership |
| Term deposit | Medium | Low (fixed term) | Low | Specific near-term goals |
What a $100/Month Investment at Birth Grows To
Assuming 8% average annual return:
| At age | Approximate balance |
|---|---|
| 5 years | $7,400 |
| 10 years | $18,400 |
| 18 years (school leaving) | $52,000 |
| 25 years (independent adult) | $103,000 |
Starting earlier is the most powerful variable.
Where to check the latest data
Rates, fees and returns change often. Before deciding, check current figures yourself:
- Sorted Smart Investor: compares fees, returns and risk levels of KiwiSaver and managed funds.
- Disclose register: holds each fund's product disclosure statement and quarterly fund updates.
- Financial Service Providers Register: shows whether a provider is registered to offer financial services in New Zealand.
- The provider's own website: has its current rates, fees and full terms; these change more often than any comparison page.