Best account for child's savings?

andyb_sv · 4 May 2014 at 3:17PM

Hi everyone,

My parents have given my daughter (6 months old) £500 to start savings for her, they also plan on adding to this a couple of times a year.

I've been looking at jisas but not sure whether I like the idea that the money will automatically become my daughters when she turns 18 as although she's cute now we never know what'll happen as she grows up.

I don't mind investing in funds etc if that turns out to be the best option.

Thanks ,

Drp8713 · 4 May 2014 at 3:38PM

We chose the Scottish Mortgage Investment Trust for our 3 year old.

http://www.bailliegifford.com/individual-investor/how-to-invest/investing-for-children.aspx

0.3% AMC and the stamp duty are the charges, so quite cheap.

xylophone · 4 May 2014 at 4:16PM

If the grandparents have given this money to your daughter it is already hers so that you can only hold it in bare trust? This means that regardless of where it is saved, she has the absolute right to access and control at the age of 18 (16 in Scotland).

See here http://uk.virginmoney.com/virgin/savings/learn/childrens-accounts/

http://www.hmrc.gov.uk/trusts/types/bare.htm

xylophone · 4 May 2014 at 4:21PM

And see http://www.bailliegifford.com/documentgateway.aspx?_id=3A39B056-DE6E-474E-870C-3DB1B9BB88F3&disclaimer=ok

page 17.

Remember that a designated account remains the property of the person in whose name the account is held, not the designee.

And see here for an explanation of tax treatment. http://www.sit.co.uk/products/investing_for_children/features/questions_and_answers/

Best account for child's savings?

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