Infant Savings

[drab1]

Hi all, apologies if this has been asked already.

As a new dad I'm unsure what the best way of saving for the child's future is. I think we will need 2 to start with:

1 - Instant access in case of emergency
2 - One which they can only access when they are 18 / 21

Any recommendations?

We will probably manage to put in around £150 - £200 per month in total.

Thanks!

[BoRED S2upid]

Personally it’s:

1 - Halifax 4% I think
2- HL S&S ISA in a selection of funds returning 10-25% per year they get access to this at 18.

[Badda]

BoRED S2upid said:

Personally it’s:

1 - Halifax 4% I think
2- HL S&S ISA in a selection of funds returning 10-25% per year they get access to this at 18.

Can I ask which funds? Those are great returns.

[elanfan]

Lots of free info without needing to logon at HL.co.uk - Junior ISA is what you are after.

HL allow you look up returns on thousands of funds going back 5 years - best advice would probably be to split the money over a range of their Wealth 150 funds. If it's going in for the longer term you should be able to build them a nice house deposit by the time they need it.

Good on you!

[otherman]

drab1 said:

1 - Instant access in case of emergency

Kind of defeats the object if you keep it where it's easy to get at. What sort of emergency?

[14-7]

Badda said:

Can I ask which funds? Those are great returns.

The Halifax isn't a fund investment it's just a childrens savings account.

[BoRED S2upid]

14-7 said:

Badda said:

Can I ask which funds? Those are great returns.

The Halifax isn't a fund investment it's just a childrens savings account.

And the S&S isas are a mixture of UK and Global ones the likes of lindsel train, fundsmith, old mutual I can’t recall the exact funds without logging in but check the 150 list as suggested above obviously accumulation funds as these are long term accounts.

[LeadFarmer]

When my son was born 11 years ago I started paying £30/month into a Halifax savings account that paid 10% interest. Those high interest days are gone, but at age 11 he now has nearly £5k in the bank. Im about to move that money elsewhere for him, and £1k of it is going into a pension that I'm about to take out for him, with monthly contributions from myself.

So whatever type of account you open for your child, do in now, and put a small amount into it each month, it soon adds up.

[Badda]

Couldn't agree more. My young kids both have jisas with decent chunks in from just £100 a month each. Uni fees and more will be in there by the time it matures.

[drab1]

Thanks all. I will look at the junior ISA option, didn't realise these were a thing.

Re. the emergency fund - you're right it's possibly not needed.. it's more for paying into regularly and withdrawing to cover birthdays / Christmases etc so nothing fancy needed. Just trying to spread the cost a bit.

[redandwhite]

I set up a Lloyds savings account - £100 p/m - should have a good wedge by the time age 16 comes!

[Craikeybaby]

We've gone slightly different for my son, I pay £25 per month into a fund in my ISA for him, as I'm not using all of my ISA limit and I wouldn't have trusted me with getting a load of money at 18. My wife also pays the same into a child savings account for him, which he will have access to when he is older. This is also where any monetary gifts go.

[Kuroblack350]

Of the High Street stuff, the Halifax is the best rate with 4% - although it's a regular saver IIRC and with £100 per month limit I think you're looking at £24 in interest over the 12 months.

HSBC is pretty good, 2.75% up to 3k - a pitiful 0.5% thereafter.

I may look to Junior ISA's in the near future, although I believe I may need to transfer his CTF in order to do so.

[Mezger]

Has anyone managed to set one of these up for their child whilst living overseas (obviously not the ISA part)?

We're expats and want to do this/something similar for our 1 year old son.

[elanfan]

Can you give Hargreaves Lansdown a ring on [phone] and their advisors should be able to point you in the right direction. You might need to set up some kind of trust to do it.

Regarding those putting money in banks - interest rates are crap so don't do it. My 3 kids have had theirs with HL for just over 3 years and with spread funds are each up between 20/25% overall. Yes there's a bit of risk but this is for the long term.

[fat80b]

Craikeybaby said:

We've gone slightly different for my son, I pay £25 per month into a fund in my ISA for him, as I'm not using all of my ISA limit and I wouldn't have trusted me with getting a load of money at 18. My wife also pays the same into a child savings account for him, which he will have access to when he is older. This is also where any monetary gifts go.

Exactly this - the only reason (nearly) to create a JISA is if you are already maxing out your personal ISA limits.

We were not so I preferred to create an ISA in the wife's name with HL with the funds intended for the kids. This way, it is separate from the rest of our investments and still in our control and not the kids when they reach 18.

For me the benefits of this approach outweigh the risks as ultimately want to be in control of this cash when the time comes...

[Soir]

elanfan said:

Lots of free info without needing to logon at HL.co.uk - Junior ISA is what you are after.

HL allow you look up returns on thousands of funds going back 5 years - best advice would probably be to split the money over a range of their Wealth 150 funds. If it's going in for the longer term you should be able to build them a nice house deposit by the time they need it.

Good on you!

My children have £5k in bonds and we want to pay in £50 per month. Any advice on which funds to choose, or how many in the HL 150? (Have never done this before, ideally want to just leave it for 10 years) having spoken to HL the min each fund per month is £25 so with paying in £50pm means can only spread this over 2 funds as I understand it? But presume can spread over any for the £5k?

Too much to choose from!