Where to invest whilst saving for property purhase.

[philv]

Im going to start giving my daughter 1-2k a month for 4-5 years, plus possibly a large lump sum 50-100k at some point.
Shes currently at uni.

Where would be a good place for her to invest this?

It has to be no risk.

Issa or ?

Thanks

[emicen]

Assuming the raison d’etre is buying a property once out of uni and first job stabilised;
- cash LISA
- cash ISA
- premium bonds

Edited by emicen on Monday 5th February 13:33

[bompey]

If you want zero risk then that's saving, not investing, so it's what emicen said; Cash ISA/LISA, or Premium Bonds.

If it's a monthly allowance then there's every chance she'll spend it as the maintenance grants are inadequate to support them in its entirety.

Edited by bompey on Monday 5th February 13:21

[philv]

Thanks for the replies.

[jeff m]

I think you may have to re-think your interpretation of risk.

Think back to the cost of a coffee, pint or a gin & T 5 and 10 years ago. Sterling inflation
Even a bond investor would have caught a cold in 22. In any currency !

I'm not going to suggest you jump into small caps,, but a high adjustable-rate or inflation linked fund might suit, or possibly something real estate linked to maybe enable you to keep up with the housing market

Whatever you decide it should match your aim.

Also, explore something with a tax advantage, in the US we have a place we can put money that can grow tax free and after 5 years can be withdrawn by a first time home buyer.

[Hustle_]

LISAs are great but you do need to look into the restrictions. Speculation that some of the conditions may be relaxed in the spring budget.

Make sure you don't come a cropper anywhere. You'll presumably want to get the ISA in your daughter's name. Not sure if that's got any hurdles associated with it. Presumably you won't want Ms. philv knowing.

[C69]

Putting part of it into a cash Lifetime ISA would be sensible, given the government's 25% bonus. However, you can only put in £4k max per year.

Just bear in mind that currently a LISA can only be used to buy a property costing £425k or less with a mortgage.

It'll also be worth carefully documenting these gifts from an inheritance tax perspective. Regular gifts from surplus income could be exempt from IHT, for example.

[Hustle_]

£450k I hope. Also hopefully soon to rise.

ETA: and it has to be the first time the beneficiary owns a property.

[ColdoRS]

Depending on how risk averse you are with this money, you could consider a regular savings account.

I have some money earmarked for an extension in a Santander savings account - 5.2% AER up to £250k. Easy access too, if needs be.

[BoRED S2upid]

Premium bonds or LISA. Definitely nothing easy access whilst at Uni. You can buy premium bonds direct in her name we do it for our kids so no giving it to her and she has to buy them which takes away any temptation.

[C69]

Hustle_ said:

£450k I hope. Also hopefully soon to rise.

Quite right, not £425k.