Child investment advice

[Snatch1]

My mother (in her late 70's) is looking to invest a sum of money on behalf of my 2 teenagers (aged 16 & 14). Probably looking at around £10K each. I was thinking a simple stocks & shares ISA. Would this be the best idea?

Is it worth investing in a childs ISA or simply go for a standard ISA? We wouldn't want them accessing the money until they're 21 so we simply won't tell them about it. Obviously when the oldest is told about his we'll have to tell the youngest but we'll simply tell him he can't access it until he's 21.

Any suggestions on how best to do this?

[LastPoster]

You have to be 18 to open an ISA (except a junior)

But there is the below on the HMRC website


"If you were born between 6 April 2006 and 5 April 2008, you can open one cash ISA before you turn 18"

[Darlo74]

Yes it has to be a JISA if they are under 18.

I have them with Vanguard for my kids, invested in LS80. My eldest turns 18 shortly and at that point it's transferred into their name as an adult ISA. Vanguard sent me a message asking for my childs email, mobile, address etc so they can notify them. We've had 'the chat' with ours and she's happy that we just keep managing it for her, so she's not going to go and blast it all away on a fancy holiday or in the pub!

[scot_aln]

Also with Vanguard but I do note that H-L now offer no fees for JISAs. Vanguard aren't exactly expensive at 0.15% platform but it all counts.

[The Gauge]

My mother has put money in trust for her children and grandkids, so the money is safe from any possible inheritance tax etc.

[mikeiow]

The Gauge said:

My mother has put money in trust for her children and grandkids, so the money is safe from any possible inheritance tax etc.

What sort of cost does that incur?

[NickZ24]

Its quite nice.
With a bit of hope the kid also learns to use that money for its benefit.

[riskyj]

On a similar topic, what’s the recommendation once the child has maxed out a JISA?

My understanding is that a child can only have one JISA. So is a GIA the best option?

My kids have money from an inheritance that id like to put away for 15/20 years With 9k in the JISA, they’ll have about 10/15k left to put somewhere.

[mike9009]

riskyj said:

On a similar topic, what’s the recommendation once the child has maxed out a JISA?

My understanding is that a child can only have one JISA. So is a GIA the best option?

My kids have money from an inheritance that id like to put away for 15/20 years With 9k in the JISA, they’ll have about 10/15k left to put somewhere.

It is interesting. Can you drop it all in a pension for them?? A good early start.....although maybe a house deposit investment would be better ....??

[Adwillsy]

possible SIPP could work out? 5k over something like 50-60 years compounded is incredible

[okgo]

mike9009 said:

It is interesting. Can you drop it all in a pension for them?? A good early start.....although maybe a house deposit investment would be better ....??

It’s £9k a year you know…

So just park it in a savings account and then stick it into the JISA next tax year, no?

[LooneyTunes]

Adwillsy said:

possible SIPP could work out? 5k over something like 50-60 years compounded is incredible

So is the effect of compound inflation.

Much better, in my view, to leave it accessible for training;career development (if a young person can quickly advance their career, the long term effect of that can be really significant) or house deposit.