Top Junior ISAs guide: discussion

MrGumby wrote: »

There are various incentives on offer, e.g. Jump (Witan) is offering a £25 John Lewis voucher for a £250 lump sum or £50 monthly/quarterly DD in a cash or investment ISA.

With an investment ISA, however, you have to take fees into account. Jump charges an annual management fee of £30 + vat p.a. which would tend to wipe out any gains on smaller investments.

By contrast, Hargreaves Lansdown offers no gifts but charges no fees either (on funds and cash, that is - 0.5% p.a. on other investments). Actually, it isn't quite that simple, but that's the gist of it.

The HL offer seems preferable, unless I'm missing something.

This is clearly a big subject that needs careful thought before buying, at least before buying a Junior investment ISA.

You also need to consider what product the Junior investment ISA converts into at age 18 and the ongoing fees once converted.

Fabius wrote: »

I don't think it's a policy. As 16 and 17 year olds can open standard cash ISAs already I expect that this is a rule, although I'll admit that I haven't checked.

Otherwise they'd get two years of both allowances.

What you say is logical but some providers, at least, seem to be accepting 17-year-olds. I just started a fictitious application on the Hargreaves Lansdown website. Nothing there says they won't accept a 17-year-old and their system was happy to go ahead when I gave DoB 13/10/1994.

Hi all,
my daughter was born in August and I want to set up a regular saving for her. However, I already manage both my and my husbands accounts, which I'm starting to struggle with - I won't have the time & energy to manage hers as well. By "manage" I mean taking a good 1-year deal and tarting the money around every year. I read an article that SIPPs are a good investment for kids. I quite like the idea of the money being available once they reach 50, rather than 18 But I've just had a look at the SIPP article on here and it seems like a lot of work. Any advice on what would be a sensible low-maintenance investment with decent returns?
Many thanks!

caelshorn wrote: »

I read an article that SIPPs are a good investment for kids. I quite like the idea of the money being available once they reach 50, rather than 18 But I've just had a look at the SIPP article on here and it seems like a lot of work. Any advice on what would be a sensible low-maintenance investment with decent returns?
Many thanks!

I think you're right - a SIPP may make more sense. I haven't read the MSE article but don't feel a SIPP needs be hard work. The easiest and, arguably, best way is probably to choose an index tracker and pretty-much forget about it for the next 50 years. You kids would, in due course, be able to get as hands-on as they chose and perhaps switch out of trackers.

Sure, there will be funds that out-perform the indices, but there will be a lot more that under-perform it, and the chances of your picking the right one(s) are fairly slim, even with careful management and periodic switching (for which you don't have time). Also, trackers have lower fees, which can have a dramatic benefit over 50 years.

Which index? Which tracker? I think you'll find the FTSE 250 has done better than the 100 or All-Share over many periods, if you examine them. Whichever index you track, check the fees before choosing a tracker product.

You could do worse than look at Hargreaves Lansdown as a provider, if you do go for a SIPP. They provide an excellent service with very low fees. (I have absolutely no connection except as a customer!)