Start their pensions. Do it. Do it now. And Max out premium bonds.
Start their pensions. Do it. Do it now. And Max out premium bonds.
I have a stocks and shares Isa but in my name so that I have control until I can trust them. I don't want them to have access when they are 18, just to waste it.
My other isa is in wife's name for our savings.
I preferred this as it gave me control. I know what I did to money when I was 18!!!!
Halifax Kid's regular saver for one year at 6%
After one year stick it in a halifax children's ISA which gives 4% provided you have at least £5 in a Halifax ISA (it's what we do - my boy has more money than me!)
MarkC
The Halifax saver looks good but you can only put in £100 to open, then you are allowed to feed it for 12 months.
So
Open from between £10 - £100.
Pay in any amount from £10 to £100 each month by standing order
Kids' Regular Saver example - If you save £50 each month, you'll earn £18.97 gross (£15.18 net) interest after 12 months.
So with £100 per month you may get £37 after a year.
Craiginuk said he has £100 per month to invest, at present a saved portion just sits in with an isa but was hoping to earn a bit of interest on it for them.
So I assume he has a lump sum from the ISA to invest for them first.
With the lump sum in a 123 trust @ 2K they would earn around £55 per year every year not 6% compounded for the first year..
+ you can take it out when ever you want.
Last edited by Fords; 7th March 2015 at 09:21.
Why not put it into an equity ISA - something like a tracker, or a combination of trackers - you have a long time horizon so you could well out of it ( or they could).
This is a better option IMO for the length of time you are saving for. If you choose a fund with a fairly good dividend stream this should give growth at a similar level to cash and also longer growth potential of the stock market. The fact you are drip feeding the cash in monthly should help to avoid some of the volatility of the markets. Also keeping it in your name means that the kids can't disinvest and waste the cash at the first opportunity, one of my clients saved for 16 years for their eldest and he spunked the lot in a week!Originally Posted by bambam
Keep a bit in cash closer to the time you need to access just in case the market has a little wobble so that you can leave the balance invested if required.
No specific suggestions, except to say that - if it were me - I'd be looking at a worldwide, heavily equity biased (possibly 80/20), probably a physical ETF, bought through JISA if possible (my kids are all older, so I don't know the rules.). Might also consider something that held equities (60%+) and bonds plus alternatives, like commercial property, too. The wider the base of assets and geographies the better I'd say, so long as total costs are low - that's absolutely key over a ten year time horizon, I reckon.
But one thing I would do is buy the ACC class rather than INC if available, because that way the income that the fund generates gets rolled back in cost effectively. And I would want something that generates a yield of 2.5%+ pa, ideally a bit more, because that makes a big difference to performance over time.
I'm not qualified to give any advice whatsoever, but FWIW that's what I'd do, if I were 30-odd again and my kids were sub-10.
Are all kids able to access an ISA now (even those that had/have Child Trust Funds)?
Not 100%, but have a feeling that those children who received CTF's couldn't invest in an ISA?
I think that you'll soon be able to transfer CTF accounts into JISAs. But the main thing is that both of these methods give the control to the child when they turn 18 and that can be a bit risky! Something in your/your wife's name is a better bet as you keep control. If they don't behave liquidate the investment and buy yourselves a sports car! At least you'll have the option.
You may be right about the control piece.
This is what I’d do. Given the long term nature of your investment it would be a poor decision to keep the capital in cash.
I've just started a Junior SIPP for my 8 month daughter, mainly to benefit from the 20% tax relief - free money, seems like a no brainer...
I also contribute to a Stocks and Shares ISA that is invested in the Vanguard Life Strategy 80 accumulator fund. 80% equities 20% bonds (Government and IG Corporate).
I started SIPPs for both of my kids when they were born. I used to pay the childs allowance into it but when that ended I continued to pay the same amount in every month. My daughter is now 15 & I've paid £84 per month into her SIPP since she was born. I've just looked at her account & she's got £35,123.40 in her SIPP
I also opened her a junior stocks & shares isa 4.5 years ago & that is standing at close to a 32% increase. I wouldn't consider a cash isa for such a long-term investment. The interest rates are derisory
Last edited by trident-7; 12th September 2017 at 16:44.
I have my daughter's savings in a fund based Junior ISA with OneFamily. The value of the units has increased by 50% over 5 years so I'm glad I didn't put it into cash with interest rates less than inflation! Also it has online account management and friends & relatives can also pay into it.
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