Can we tell our child's benefactors which account to put cash in?

Former_MSE_Joanne · 18 December 2014 at 4:37PM

We have a small child and we opened an ISA for her which has a decent savings rate. However, every Xmas and birthday her paternal grandparents invest money in her name into premium bonds, which have a much lower chance of a return than we can get with the ISA. We would prefer they pay the money into the account we set up as we feel it's our duty as her parents to get her the best return on her money while she is young. Is it right for us to request the money they give is paid into the ISA?

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nikki299 · 22 December 2014 at 8:13PM

Can you not just cash in the premium bonds and pay the money into the isa yourself?? No hurt feelings or awkwardness that way, and i can't see how they would ever know.

alexanderalexander · 22 December 2014 at 8:48PM

I realise that it's not quite answering the question you asked (although very obviously related), but if you're investing for a young child you'd almost certainly get a considerably better return by putting into shares rather than cash.

duchy · 22 December 2014 at 8:55PM

You can tell them whatever you like .......although they are equally entitled to think you should accept their gift with grace.....and equally entitled not to bother as you are so ungrateful.

Only you know if your aversion to premium bonds is violent enough to risk that happening.

freezspirit · 22 December 2014 at 11:17PM

I would be grown up and have a discussion with them and say that I appreciate what they are doing towards their grandkids however by putting their money gifts into the jisa would make better value once the child reach the age to access it than buying pbs.

Have information in front of you as proof.

Calculators
http://www.moneysavingexpert.com/savings/premium-bonds-calculator/
http://www.moneysavingexpert.com/savings/best-cash-isa

Information
https://www.gov.uk/junior-individual-savings-accounts/overview
http://www.telegraph.co.uk/finance/personalfinance/money-saving-tips/10668206/Four-ways-to-save-and-invest-for-grandchildren.html
http://www.moneysavingexpert.com/savings/junior-isa
http://www.thisismoney.co.uk/money/saving/article-1583863/Best-savings-rates-Junior-Isas-childrens-accounts.html

Serendipitious · 23 December 2014 at 12:53AM

Maybe they enjoy checking the numbers to see if there are any winners. And maybe her bonds will actually win during the time they are held.
They are buying the opportunity for her. And I wouldn't deny anyone that, especially when it is their own money they are using to fund it. Your little one is accruing a cash lump sum whatever happens, from her thoughtful grandparents.

Leeward · 23 December 2014 at 1:21AM

Yes, you're perfectly entitled to ask then to put cash into an ISA or whatever you think is the best option for you. They are also perfectly entitled to ignore you and do whatever they want for their granddaughter.
Seems a sensible chat is in order and for you to accept their choice with grace. After all, your daughter might win big...

lucyhen · 23 December 2014 at 2:26AM

When I was a small child my grandmother saved religiously in the PO until I was 7 and then bought me £5 Premium Bonds. It was quite a lot those days - 1961. I've never won a thing with them but have hung on just the same - ever hopeful!

Talent · 23 December 2014 at 9:06AM

You should not cash them in without telling them, that is mean and hurtful. If you really think it would be better for your child, discuss it with them. I would let things be though and accept there will be a guaranteed lump sum in the future.

Augustus_the_Strong · 23 December 2014 at 9:18AM

It would be reasonable to discuss it. Older people may think in terms of premium bonds as that used to be the best option, but it would be surprising if they didn't want to do the best for their grandchild. They may not want to give up the chance of winning a jackpot though.

SandraDJ · 23 December 2014 at 9:32AM

My mother did the same for both of my daughters. They each won £50 in a short space of time, which was a good return for the amount of bonds that they held.

I'd keep them, you never know!

Can we tell our child's benefactors which account to put cash in?

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