How to Set Up a Bitcoin Savings Account for Your Child

There's no “Bitcoin savings account” the way there's a bank savings account. No FDIC insurance. No guaranteed interest rate. What people actually mean when they search for this: a way to regularly buy and hold Bitcoin for their kid, ideally with some structure around it.

A Bitcoin savings plan for a child is three things bolted together: a recurring buy schedule on an exchange like River (0% fee on recurring buys¹), a hardware wallet for custody, and a plan for when you'll hand the keys to your child. You can start with as little as $5/week.

What are you actually building?

A Bitcoin savings plan for a child is three things bolted together:

1. A recurring buy schedule (how much, how often)
2. A custody solution (where the Bitcoin lives)
3. A handoff plan (when and how the kid gets it)

That's it. No special account type needed. No minimum balance. You can start with $5/week. Saylor framed the urgency well: he realized his company's cash was a “melting ice cube” losing “at least 10% a year, but probably 20% a year” to purchasing power erosion.¹⁰ Your kid's savings account faces the same problem on a smaller scale. A bank account earning 4% while inflation runs at 3-5% is treading water at best.²

Which platform should I use for recurring Bitcoin purchases?

You want an exchange that supports auto-recurring purchases and has low fees. The fee difference matters over 18 years of weekly buys.

• River: 0% fee on recurring buys.¹ Auto-withdrawal to your own wallet. Bitcoin-only. This is what I use and what I recommend for most parents.
• Strike: Very low fees (~0.3%).³ Simple interface. Good auto-buy feature. Also Bitcoin-focused.
• Cash App: 1.5-2.5% spread on each buy.⁴ Convenient but the fees eat into your stack over time. On $25/week, that's roughly $20-30/year in extra fees compared to River.
• Coinbase: Fees vary, but typically 1-2% for recurring buys. Fine but more expensive than the Bitcoin-only options.

How much should I invest and how often?

Weekly beats monthly for dollar-cost averaging (more entry points smooth out volatility), but either works. What matters is consistency.

• $10/week ($520/year): A solid starting point. Over 18 years, you'll contribute $9,360 total.
• $25/week ($1,300/year): More aggressive. $23,400 total over 18 years.
• $50/month ($600/year): The minimum I'd suggest if you're serious about this as a savings vehicle. $10,800 over 18 years.

Pick an amount you can sustain through a bear market. When Bitcoin drops 60%, your instinct will be to pause. That's actually the best time to keep buying. Set it and don't touch it.

How should I set up custody for my child's Bitcoin?

For the first few months, leaving the Bitcoin on the exchange is fine. Once you've accumulated $200-500+, move it to a hardware wallet. (Full walkthrough in our wallet setup guide.)

My setup:

• Buy weekly on River (auto-recurring)
• Withdraw to a Trezor hardware wallet once a quarter
• Seed phrase stored in a fireproof safe, separate from the device
• A second copy of the seed phrase stored with my estate documents

River has an auto-withdrawal feature that sends your Bitcoin to a wallet address you specify whenever your balance hits a threshold. Set it to $250 and forget about it.

Why should I track my cost basis?

This sounds boring but it'll save you (or your kid) thousands in taxes later. The IRS treats Bitcoin as property,⁵ so every purchase creates a tax lot. Every time you buy, record:

• Date of purchase
• Amount of Bitcoin (in sats)
• Price per Bitcoin at time of purchase
• USD amount spent

A simple spreadsheet works. River and Strike also keep transaction history you can export. When you eventually gift the Bitcoin to your kid, this cost basis transfers to them.⁵ If they sell without it, they could end up paying more tax than necessary. (More on the tax side in our can minors own Bitcoin guide.)

Why should I avoid “Bitcoin yield” accounts?

Some companies have offered “earn interest on your Bitcoin” accounts. Celsius offered 6-8% APY on Bitcoin deposits. Then it went bankrupt in 2022 and customers lost billions.⁶ BlockFi, same story.⁷ Voyager, same story.⁸

If someone is offering you yield on your Bitcoin, they're lending it out. That means counterparty risk. For a savings account meant to last 18 years, counterparty risk is the thing that can ruin the entire plan. Hold your own keys. Earn 0% yield and sleep well.

What could a Bitcoin savings plan be worth in 18 years?

Nobody can predict Bitcoin's price. But we can model scenarios to understand the range of outcomes for a $25/week plan ($23,400 total contributed):

• Bear case (0% return): Your kid has $23,400. You basically just saved cash with extra steps.
• Moderate case (15% annual return): Roughly $150,000.
• Bull case (30% annual return): Over $1 million. (Bitcoin's actual CAGR since 2013 has been higher than this,⁹ but expecting that to continue is optimistic.)

The asymmetry is the point. The downside is you saved $23,400 that's worth less. The upside is life-changing. That's why you size it as money you can afford to lose, not your kid's entire savings. (Still weighing the decision? Start with should I buy Bitcoin for my child, or compare it to a 529 plan.)

How do I explain a Bitcoin savings plan to my kid?

• “Is this like my piggy bank?” Similar idea, different tool. Your piggy bank holds dollars. This is Bitcoin, which works differently. The amount of Bitcoin stays the same, but what it's worth in dollars changes every day. (Here's what Bitcoin is in kid-friendly terms.)
• “Why don't you just put it in the bank?” Banks pay almost nothing in interest right now. A savings account might earn 4% in a good year.² I think Bitcoin has a chance of doing much better over the next 15 years. But it's riskier, so we do both.
• “What if Bitcoin goes to zero?” Then we lose this savings, and that would hurt. That's why we don't put everything into Bitcoin. This is one part of how we save, not the whole thing.

Try this at home

The DCA simulator (15 minutes, ages 10+). Go to dcabtc.com and plug in different scenarios: $10/week starting 5 years ago, 3 years ago, 1 year ago. Show your kid how the same amount of money buys different amounts of Bitcoin depending on when you buy, and how buying consistently smooths out the highs and lows. Then set up their actual recurring buy together.

Materials: A computer or phone, dcabtc.com. Time: 15 minutes.

Sources

1. River Financial, Recurring Buying on River (0% fee on recurring purchases)
2. FDIC, National Rates and Rate Caps (savings account averages)
3. Strike, Strike Fee Schedule
4. Cash App, Bitcoin Fees
5. IRS, Frequently Asked Questions on Virtual Currency Transactions
6. Reuters, “Celsius Network files for bankruptcy” (Jul 2022)
7. SEC, “BlockFi Agrees to Pay $100 Million in Penalties”
8. CNBC, “Voyager Digital files for bankruptcy” (Jul 2022)
9. Coinglass, Bitcoin Historical Returns Data
10. Saylor, Michael. Interview on The Breakdown, describing MicroStrategy's cash as a “melting ice cube” (2020)