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snugglepet20 wrote: »...
Long term is this going to pan out fairly, the woman on the phone said that DS will have more shares and long term they will be worth more as he still owns all the shares that have been bought but is this even right? Surely they are buying and selling shares all the time not just keeping them all? Also why such great performance for one account and not the other? ...
As I understand it the general principle of all investments funds (whether it's a CTF or a pension or whatever) is that your money buys 'units' in the fund. The cost of these units depends on the average cost of the underlying investments.
For example, let's say the CTF tracks the FTSE 100. So there are 100 companies and the share price of each is very different. Let's say you invest £100 a month. Every investment company does things slightly differently but the basic idea is that they take your money, put it into a huge pot and buy shares in every company in the FTSE 100.
The investment companies are essentially using an investment method called 'averaging down'. It means that if share prices are expensive your £100 will by less of them, but if share prices are cheap your £100 will buy lots of shares.
Perhaps a better way of thinking about it is if you invest the money yourself in one company. This month the shares are worth £100 each so your £100 buys one share. But over the next 9 months the share price drops and holds steady at £1. You continue investing £100 a month so in next 9 months you accumulate 900 shares, bringing your total to 901 shares, seemingly worth £1000. But in the 11th month the price rockets again to £100 and now your 901 shares are worth £90,100.
The reason your older son won't lose out (according to history anyway) is that when share prices fall his money is buying more units (i.e. shares) and these will be worth more when the stock market rises again.
Hope that all makes sense.0 -
Hi wondering if anyones had this problem. When the child reaches 1 if on a low income then a extra payment is supposed to be paid. My littleun is now nearly 2 and still not had this money, excuses I've had - sept we have to wait until the tax credits for this year have been looked at, oct and nov we have to wait for notification from tax credit that you qualify. Jan (finalised) I'll chase up for you are you sure they've been finalised???? Still waiting. Annoyed as he is now loosing interest on this and I think it is very unfair to him0
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Received today the voucher for little Oliver.
Engage Mutual are offering £50 cashback via Quidco. This seems like an almost an unmissable offer to me as it's switchable later if not working out.
Unless it's an absolute dog of a product it's a good offer unless I'm missing something?0 -
If you follow this link Reaper has posted a link to a website which may help you decide if it is worth it or not.Received today the voucher for little Oliver.
Engage Mutual are offering £50 cashback via Quidco. This seems like an almost an unmissable offer to me as it's switchable later if not working out.
Unless it's an absolute dog of a product it's a good offer unless I'm missing something?Personal Responsibility - Sad but True
Sometimes.... I am like a dog with a bone0 -
Hello there. I have some child trust fund vouchers to invest. Could I ask your opinion on my thoughts on a low cost way to invest them. I have decided that I will be investing in some kind of share tracker. So the decision now is finding the best way to invest.
From what I can see most providers seem to charge the maximum 1.5% annual management charge.
However I have thought that potentially a way to avoid such high ongoing charges is to invest in Selftrades Self-Select Child Trust Fund, then use this to invest in a ETF (Exchange Traded Fund), say a FTSE 100 tracker for example.
Selftrade charge £25 per transaction, then no ongoing annual fees. The ETF will take a fee, but my understanding is that this will be in the range of 0.1 to 1 %.
So although I will pay an upfront fee of £25 the fees over the lifetime of the fund will be lower, especially if I also invest some extra money on top of the £250 voucher.
Any thoughts on this from any of you?0 -
SelfTrade £12.50 per trade plus any stamp duty (if applicable).Selftrade charge £25 per transaction, then no ongoing annual fees. The ETF will take a fee, but my understanding is that this will be in the range of 0.1 to 1 %.
You are correct but still on £250 thats still a 5% buying charge.So although I will pay an upfront fee of £25 the fees over the lifetime of the fund will be lower, especially if I also invest some extra money on top of the £250 voucher.
Any thoughts on this from any of you?
We have our childs CTF in Selftrade but it was made up to £1000 when we started so that I could feel better about the dealing cost.
Personal Responsibility - Sad but True
Sometimes.... I am like a dog with a bone0 -
omg, this is really quite complex isn't it. I am due to give birth in about 4 weeks, but am only just starting to look at what changes will happen with tax credits and wotnot... I think we will treat the CTF as 'bonus funds' for baby and will invest high risk. I would like to set up some sort of regular saver for baby, but have a clause where they absolutely cannot have it until they are at least 21. I had £10k at 18 and blew the lot in months.
Therefore I would love to arrange a trust where my child cannot have funds until a certain age, or specifically for a mortgage deposit or something significant like that. Any ideas on how to go about this?0 -
Hi all,
I have 2 children (2 & 4) who both have Cash CTFs, with Britannia at the moment.
I'm looking to transfer both CTFs to the Yorkshire BS as it has a better rate.
Does anyone know whether interest on CTFs is payable daily, weekly, monthly, yearly, etc? I don't want to lose a year's interest by transferring their accounts at the wrong time! :eek:
Thanks,
Emily xx.
We also have our 18month old sons 250 in Britannia. When I took it out looking through all the options Britannia offered 7% which we thought was the best place for it.
Only now realised when the base rate fell to 0.5% so did our CTF rate.
Its hardly had any interest the last year and a half.
We are expecting another little girl due in 3 weeks so have to decide her CTF and will move our sons somewhere better as well.
Want to wait and see what changes there will be after this Thursdays election.
Any thoughts as to which option is best?
We wish we could put them both into gold and silver, is there any options like this?0 -
As always define best, not an easy one to offer help with.Any thoughts as to which option is best?
You can do it if you open a Self Select CTF. The one I am aware of (use) is SelfTrade. Within this you pretty much have access to anything you can hold in a S&S ISA, including products which hold physical gold and silver (ETC's etc).We wish we could put them both into gold and silver, is there any options like this?
There is a £12.50 dealing charge to buy and to sell so for £250 it works out to be 5%.Personal Responsibility - Sad but True
Sometimes.... I am like a dog with a bone0 -
It seems that the Hanley Building society are currently offering a cash CTF at 5%.0
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