Best way to invest the kids cash.
Discussion
At the moment my kids cash is languishing in their respective children's saving accounts.
One has cash sitting in a virgin account i think getting 1.75%, the other is with the nationwide getting a similar paltry amount. They both also have CTF's with a couple of grand sitting in each.
We are considering moving their money to a junior ISA. Maxing this years allowance and doing similar after April 2021.
Coventry are currently offering 2.95%, which is better than they are currently getting but subject to change, more than likely to go down.
But then there are junior Stocks and Shares ISA's
The vanguard lifestrategy portfolio seems a decent option with low fees, providing pre selected investments, with various degrees of risk. 20%, 40%, 60% share to bond ratio etc.
Being fairly risk averse and not wanting to lose the kids cash, but with time to recover short term loses. (Kids are 10 and 13) should we sit tight with what we have set up already, or consider the move.
To add into the mix my wife has an IFA, who is advising setting up an adult stocks n shared isa which would give us control over the kids cash, but then he'll get 600 quid to set it up, and then 1% for every year for ever more plus the providers charges.
Its all a bit of a mine field.
Thanks in advance.
One has cash sitting in a virgin account i think getting 1.75%, the other is with the nationwide getting a similar paltry amount. They both also have CTF's with a couple of grand sitting in each.
We are considering moving their money to a junior ISA. Maxing this years allowance and doing similar after April 2021.
Coventry are currently offering 2.95%, which is better than they are currently getting but subject to change, more than likely to go down.
But then there are junior Stocks and Shares ISA's
The vanguard lifestrategy portfolio seems a decent option with low fees, providing pre selected investments, with various degrees of risk. 20%, 40%, 60% share to bond ratio etc.
Being fairly risk averse and not wanting to lose the kids cash, but with time to recover short term loses. (Kids are 10 and 13) should we sit tight with what we have set up already, or consider the move.
To add into the mix my wife has an IFA, who is advising setting up an adult stocks n shared isa which would give us control over the kids cash, but then he'll get 600 quid to set it up, and then 1% for every year for ever more plus the providers charges.
Its all a bit of a mine field.
Thanks in advance.
8 years is a decent investing timeframe, 5 years is a bit tighter, but still tolerable.
You don't need an IFA to set up an ISA - they're easy enough.
If you're happy with Lifestrategy, you can go straight to Vanguard and open one there (or use your existing broker/ISA if you have one as you can't pay in to two different ISAs in the same tax year). Vanguard even do a pdf suggesting which bond/equity ratio they consider appropriate for a particular investing duration.
https://www.vanguard.co.uk/documents/adv/literatur...
If you're tight on adult ISA allowance then a junior ISA gives you more at the cost of the child having control at 18. If you've got spare ISA allowance then you can put it in your ISA, but you'll need to keep mental track of what belongs to who IYSWIM.
You don't need an IFA to set up an ISA - they're easy enough.
If you're happy with Lifestrategy, you can go straight to Vanguard and open one there (or use your existing broker/ISA if you have one as you can't pay in to two different ISAs in the same tax year). Vanguard even do a pdf suggesting which bond/equity ratio they consider appropriate for a particular investing duration.
https://www.vanguard.co.uk/documents/adv/literatur...
If you're tight on adult ISA allowance then a junior ISA gives you more at the cost of the child having control at 18. If you've got spare ISA allowance then you can put it in your ISA, but you'll need to keep mental track of what belongs to who IYSWIM.
If you open up Junior ISAs for each of them then the money is theirs & they can get access at 18 - is this what you want? It does segregate the money for each child rather than lump it all together in one pot.
Do you currently use up all of your £20k ISA allowance each year? If you do then a JISA might be the way to go. If you don't then you could just put it into an adult ISA in your name but it could get a bit limiting as you can only pay into one type of ISA each year, so you couldn't pay into a S&S ISA for you & another for the children. It could end up as a mess.
Don't forget your could also open up a personal pension for each child which would obviously be a very long term investment but might be worth considering.
You don't need to pay anyone to set up an ISA; you've already found Vanguard & they have a range of funds to pick from. Even Hargreaves Lansdown don't charge to open an ISA although their charges are a bit steep.
Have a read of the IM sticky at the top of this forum as well.
Do you currently use up all of your £20k ISA allowance each year? If you do then a JISA might be the way to go. If you don't then you could just put it into an adult ISA in your name but it could get a bit limiting as you can only pay into one type of ISA each year, so you couldn't pay into a S&S ISA for you & another for the children. It could end up as a mess.
Don't forget your could also open up a personal pension for each child which would obviously be a very long term investment but might be worth considering.
You don't need to pay anyone to set up an ISA; you've already found Vanguard & they have a range of funds to pick from. Even Hargreaves Lansdown don't charge to open an ISA although their charges are a bit steep.
Have a read of the IM sticky at the top of this forum as well.
For kids I'm a huge fan of, say, 50/50 between pension (for the "free money" tax relief and long term cumulation) and ISA (for the ongoing tax relief combined with instant access.)
In the current climate any cash savings will simply be shrinking with inflation. What could be higher risk than a guarantee of losing money?
What you need for kids - mainstream, low cost stocks & shares funds.
What you don't need for kids - paying fees to an IFA.
In the current climate any cash savings will simply be shrinking with inflation. What could be higher risk than a guarantee of losing money?
What you need for kids - mainstream, low cost stocks & shares funds.
What you don't need for kids - paying fees to an IFA.
Do NOT pay an IFA £600 and 1% a year for this. It is a waste of money.
Have a look at Vanguard and others for a low cost managed ISA in your name (that you have simply earmarked for the kids).
A long term SIPP/Pension contribution may seem like a lifetime away for them, but (unfortunately) it comes round more quickly than you think!
Have a look at Vanguard and others for a low cost managed ISA in your name (that you have simply earmarked for the kids).
A long term SIPP/Pension contribution may seem like a lifetime away for them, but (unfortunately) it comes round more quickly than you think!
Please take Julians advice with this!
I set up my own S&S isa with vanguard took me (a novice by all definitions) 10 minutes. Your IFA will be earning £60 per minute!
The 1% fee doesnt sound like a lot but it adds up massively over the years.
Vanguard account setup < will take you to the page you need. No fee.
I set up my own S&S isa with vanguard took me (a novice by all definitions) 10 minutes. Your IFA will be earning £60 per minute!
The 1% fee doesnt sound like a lot but it adds up massively over the years.
Vanguard account setup < will take you to the page you need. No fee.
JulianPH said:
Do NOT pay an IFA £600 and 1% a year for this. It is a waste of money.
Have a look at Vanguard and others for a low cost managed ISA in your name (that you have simply earmarked for the kids).
A long term SIPP/Pension contribution may seem like a lifetime away for them, but (unfortunately) it comes round more quickly than you think!
I would agree with the above.Have a look at Vanguard and others for a low cost managed ISA in your name (that you have simply earmarked for the kids).
A long term SIPP/Pension contribution may seem like a lifetime away for them, but (unfortunately) it comes round more quickly than you think!
I have just setup my 5 week old daughter with a JISA with Intelligent Money.
I stuck it in their PH Equity fund. Hopefully their fund manager picks some good equities over the years.
CornishRob said:
JulianPH said:
Do NOT pay an IFA £600 and 1% a year for this. It is a waste of money.
Have a look at Vanguard and others for a low cost managed ISA in your name (that you have simply earmarked for the kids).
A long term SIPP/Pension contribution may seem like a lifetime away for them, but (unfortunately) it comes round more quickly than you think!
I would agree with the above.Have a look at Vanguard and others for a low cost managed ISA in your name (that you have simply earmarked for the kids).
A long term SIPP/Pension contribution may seem like a lifetime away for them, but (unfortunately) it comes round more quickly than you think!
I have just setup my 5 week old daughter with a JISA with Intelligent Money.
I stuck it in their PH Equity fund. Hopefully their fund manager picks some good equities over the years.
Banging my head off a wall here.
So the whole purpose of this was to transfer the kids CTF's to a JISA.
I've tried opening a jisa through vanguard, however the platform will not allow my to do this because they have an existing CTF.
The current providers of the CTF do not offer JISA's but are happy to transfer to Vanguard once I've opened a JISA with them.
But Vanguard won't let me open a JISA because of the CTF
Very frustrating.
So the whole purpose of this was to transfer the kids CTF's to a JISA.
I've tried opening a jisa through vanguard, however the platform will not allow my to do this because they have an existing CTF.
The current providers of the CTF do not offer JISA's but are happy to transfer to Vanguard once I've opened a JISA with them.
But Vanguard won't let me open a JISA because of the CTF
Very frustrating.
Terzo123 said:
Banging my head off a wall here.
So the whole purpose of this was to transfer the kids CTF's to a JISA.
I've tried opening a jisa through vanguard, however the platform will not allow my to do this because they have an existing CTF.
The current providers of the CTF do not offer JISA's but are happy to transfer to Vanguard once I've opened a JISA with them.
But Vanguard won't let me open a JISA because of the CTF
Very frustrating.
I suppose you could open a cash JISA and transfer the CTF into that and then transfer the cash JISA to vanguard S&S JISA.So the whole purpose of this was to transfer the kids CTF's to a JISA.
I've tried opening a jisa through vanguard, however the platform will not allow my to do this because they have an existing CTF.
The current providers of the CTF do not offer JISA's but are happy to transfer to Vanguard once I've opened a JISA with them.
But Vanguard won't let me open a JISA because of the CTF
Very frustrating.
xeny said:
Terzo123 said:
Ha, the kids are demanding the investment be ethical and also have a good chance of a positive return.
Which do they see as the priority?The kids are oblivious to it all at the moment. From my point of view a positive return is the priority over a time scale of 7 to 10 years, there or there abouts.
Terzo123 said:
I said it in jest to Groak's obviously tongue in cheek reply.
Wasn't entirely tongue in cheek. For the last 8 years I've done a Bayern/Celtic (I know, I know, I DO feel the shame) double which has never let me down. Not this year, tho' I'm thinking a Bayern/PSG double could be a goer, although this year's already proving predictably weird and maybe best to miss a year.
I do quite well from football betting. Stick strictly to often (tho' not always) dreadful odds on 'certainties' and rarely lose.
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