Soon-to-be parents whose newborn babies arrive on the very last day of 2020 can also look forward to a small financial treat.
Ally Bank is giving away $250 custodial online savings accounts to all babies born by midnight on Thursday, Dec. 31, 2020.
"It's our way of ending 2020 on a positive note," an Ally Bank spokesperson said in a statement shared with CNBC Select.
After an immensely challenging year, the popular internet bank's initiative is meant to give the future generation of savers a head start toward a positive financial future and provide a "special welcome" to the new babies who were likely, as Ally points out in its press release, conceived at the beginning of the pandemic.
"There will always be something special about the babies of 2020. You've entered our world at a seminal moment, and seminal moments come with their own circumstances. Your family might be feeling the anxiety and loss that have hit so many this year. But in the midst of that, you've brought them joy."
If your child is born this New Year's Eve, here's what you need to know to claim your baby's $250:
- Have your baby's social security number handy.
- Visit Ally Bank's program page beginning on Jan. 15, 2021 to enroll.
- After enrolling, you'll get a prompt to open a custodial Ally Online Savings Account (where Ally will deposit your baby's money).
- Make sure you upload your child's birth certificate by July 31, 2021 to receive the funds.
Applications close on July 31. Be sure to enroll and submit your baby's documentation by then to receive the $250.
The money in your child's new custodial account legally belongs to them and can be transferred when they reach the age of majority in your state (usually between 18 and 21). You can continue depositing money into your child's custodial account through their life, so you might use this opportunity to kick-start good savings habits that will benefit them.
What if you have twins or triplets? Each new member of the family is eligible for their own custodial account and $250 deposit.
Depositing just $20 per week into your child's savings account will equal about $1,000 over a year. Fast forward 18 years down the road, and consider how your small but consistent contributions could set your new baby up for success once they become an adult.
The year 2038 is hard to fathom but helping your child feel financially secure can give them the confidence to aspire to solve future challenges and achieve big dreams.
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