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My first thread! (It's a request for assistance - sorry!)
Smass101
Posts: 5 Forumite
Hi everybody, i've been lurking around this site for about a year now and thought it was time i actually started posting!!
I'm lucky enough to have become a father for the first time on the 13th June - finally! During the late nights i've been provoked into taking a look over my finances and arrangements. I think having children makes you really take stock and a hard look at certain aspects of your life doesnt it?
Wills, benefits, tax credits (yeah right!), doctors, dentists, school applications - the list goes on! I'm having a couple of dilemma's and wondered if i could trouble a few people for some assistance?
I really want to set up some sort of long term saving in my name but for Nathaniel for when he is older. Preferably to pay for his education fees but it may end up as being a lump sum toward a house deposit plus we may dip into the fund if we are ever struggling to afford say a holiday for him or a school trip etc. I dont like the idea of the CTF as i have no control over this money if he (hopefully not) turns out to be a bit, shall we say "boisterous?" with his cash. Ideally he would know nothing at all about the money till the time came that he needed it.
My initial idea was to drop in a lump sum of about £1000 then have a direct debit of around 80 - 100 pounds per month with the option to increase/decrease this as time goes on but i have no idea what sort of product would be best! I like to think i am fairly hands on with my money but i cant work out what would be the best move on this. Definitely from a tax point of view but also with a view to maintenance. It would be nice to just have a DD of 100 a month for 16 years and have a massive lump sum at the end of it but i'm assuming getting the best results would require more maintenance than that?
If anyone has any ideas - or if i have the wrong end of the stick completely please feel free to comment and advise! I need all the help i can get!! :rolleyes:
Thanks.
smass101
I'm lucky enough to have become a father for the first time on the 13th June - finally! During the late nights i've been provoked into taking a look over my finances and arrangements. I think having children makes you really take stock and a hard look at certain aspects of your life doesnt it?
Wills, benefits, tax credits (yeah right!), doctors, dentists, school applications - the list goes on! I'm having a couple of dilemma's and wondered if i could trouble a few people for some assistance?
I really want to set up some sort of long term saving in my name but for Nathaniel for when he is older. Preferably to pay for his education fees but it may end up as being a lump sum toward a house deposit plus we may dip into the fund if we are ever struggling to afford say a holiday for him or a school trip etc. I dont like the idea of the CTF as i have no control over this money if he (hopefully not) turns out to be a bit, shall we say "boisterous?" with his cash. Ideally he would know nothing at all about the money till the time came that he needed it.
My initial idea was to drop in a lump sum of about £1000 then have a direct debit of around 80 - 100 pounds per month with the option to increase/decrease this as time goes on but i have no idea what sort of product would be best! I like to think i am fairly hands on with my money but i cant work out what would be the best move on this. Definitely from a tax point of view but also with a view to maintenance. It would be nice to just have a DD of 100 a month for 16 years and have a massive lump sum at the end of it but i'm assuming getting the best results would require more maintenance than that?
If anyone has any ideas - or if i have the wrong end of the stick completely please feel free to comment and advise! I need all the help i can get!! :rolleyes:
Thanks.
smass101
0
Comments
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Welcome, and congratulations!!!
For the monthly standing order idea, you could do far worse than the Halifax children's regular saver, http://www.halifax.co.uk/savings/childregularsaver.asp , with the great rate of 10% fixed for a year.
Providing you've a decent savings account, you could put the lump sum there, and run regular savers for the monthly standing order, transferring the funds to your savings account at the end of the year. If you don't want to be watching it daily, get one with a rate guarantee and just review it every 6 months or so, to check you're still getting a good deal.Target Cash Net Worth: £25K by January 2012
Progress May-08 19.0%; May-09 40.0%; May-10 63.0%; May-11 58.4%; Jun-11 58.5%; Jul-11 58.9%; Aug-11 58.7%; Sep-11 59.0%
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PS: Nathaniel is just the cutest name ever. One of my faves.Target Cash Net Worth: £25K by January 2012
Progress May-08 19.0%; May-09 40.0%; May-10 63.0%; May-11 58.4%; Jun-11 58.5%; Jul-11 58.9%; Aug-11 58.7%; Sep-11 59.0%
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Thanks! Quick response too!
We really liked Nathaniel, also liked Caleb... but it sounds a bit scary - so with him being born on Friday 13th we decided against it :-)
So to get me started you think a Regular Saver where the cash goes to a Save4it account after the 12 months? I was thinking of opening a Kaupthing account to hold cash while i save for a car - i suppose i could move the cash from the save4it into there to get the higher interest at the end of the year. I'd just have to be careful to document wat was mine and what was Nathaniel's!!0 -
If you are thinking of a deposit based account, you should open it in a 'trustees account'. Virtually all these accounts for young children are in the name of 'Trustee of Nathaniel XXX'. This means filling out an IR85 to receive the interest gross. One other suggestion, which we did when my daughter was born (15 years ago!!) was to have the Child Benefit paid into a savings account for her. This now helps to pay a little for her education.
15 year ago I opened kids endowments, and another 10 year plan 6 years later. Don't think you would do that now, however, combined they only cost £60 p.m. and the 1st matures next July. It will help to fund a something for her, but not sure what yet!
David0 -
Yes - I'm thinking the same thing with the Child Benefit. It's money i'm not using to having anyway so if i divert it straight to a savings account then i wont miss it and hopefully Nathaniel will see the benefit of it in about 18 years time.
From you guys are saying i think i will go down the Halifax route for the next four/five years or so then review the situation once i have a nice lump sum on the go for the new boy Massey! Cheers all!
:T 0 -
If you (or the OH) don't use your ISA allowance .... put the money in there. That way there's no doubt about who it belongs to - and it resolves the tax situation at a stroke. It also keeps it legitimately (and very sensibly) in your name.
By all means push the monthly 'new money' via the Halifax account - but then dump the lump sum + interest into the ISA when the RS matures (then start it over).If you want to test the depth of the water .........don't use both feet !0 -
I think you really need to decide what you want to save money for. It's 'for N when he's older' but 'we may dip into it'? It doesn't sound too good for your son, and you won't want to have to say, when he's 18, 'we had some money saved for your uni fees but we spent it on this house'.
You're going to have a CTF anyway (cos you get £250 to start it off), so maybe, if you're uncertain whether you're saving enough for other purposes, you should put his money into it (it's what they're for, after all) but scale it down so that you can still save for yourselves separately. Er, and maybe for the next one(s)??
Don't start judging him at this early age to be a possible spendthrift, it will be his money to do as he likes with but you've got 18 years to educate him in the ways of spending wisely.
A further thought has occurred to me: in the (hopefully unlikely) event of divorce, whose money will it be then? If it's in a CTF, it remains his. Otherwise he may well lose it.0
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