Use your child - best child savings account

Chango38

Please forgive me if this is not following the same vein but I'm new
My in-laws have £5,000 to invest for both of my teenage kids, the questions is where to put it? The kids want it tied up until they are 20 which is 3 and 5 years respectivley. We may also like to add to it along the way. Any suggestions?

olgadapolga

Hi,

I am in the process of filling in my tax return and have a quick question about my children's savings.

My three children all have two savings accounts, one account with me as trustee, the other account with my partner as trustee. Therefore, my DP and I are trustees for three accounts each.

I know that there is a rule that if the interest on savings given by a parent is more than £100, it is classified as the parent's income and taxed accordingly.

Is this amount per parent and per child? I think that each account received about £70 interest but would HMRC add the interest together from the three accounts to work this out? I am trying to calculate what I need to put on my Tax Return (ultimately the interest will not be taxed anyway as we are both non-taxpayers but I want to get the tax return right).

I hope that someone understands what I am trying to say!

TIA

debbie42

olgadapolga wrote: »

Is this amount per parent and per child?

Yes, each child can earn up to £100 from each parent and not pay tax on the interest.

e-shark

Chango38 wrote: »

Please forgive me if this is not following the same vein but I'm new
My in-laws have £5,000 to invest for both of my teenage kids, the questions is where to put it? The kids want it tied up until they are 20 which is 3 and 5 years respectivley. We may also like to add to it along the way. Any suggestions?

Hi Chango

There are lots of options that you can do with the money and it depends on how much risk you want to take.

If its for their education, most parents would take a less riskier route and put it in a high interest tax-free savings vehicles like Children's Account (don't forget to fill out an R85), NS&I has some tax free high interest accounts and also premium bonds (with an opportunity to win a bigger prize without risking the capital), most friendly societies offers TESPS (Debbie explained that earlier re.£100), and you always set up an ISA for yourself (if you haven’t used up your allowance) for £5,000 (£3,000 cash and £2,000 stakeholder). For more in depth explanation of these savings products, take a look at this website. http://www.myeggnest.com. It has everything you will need to know to get you started.

If you are looking for something riskier than high interest savings, then you will need to look for an investment fund. Most offer low, medium and high risk funds. Again its upto you decide. If you need some basic low down on what these are, speak to an IFA (most will offer 30-60mins free of charge).

Below are some funds for children to look out for:

http://www.henderson.com/home/uk/personal_investors/products_and_services/children/
http://www.bailliegifford.com/pages/UKPersonalInvestors/Children/InvestingforChildren.aspx
http://www.engagemutual.com/child-savings.asp

Hope this helps.

E

peternick_2

I wouldnt recommend the Halifax high interest saver - they dont seem to know much about it!
when i asked about my husband and I each opening one of these to maximise my son's savings potential they discouraged this by saying that as he was age 14 it should be in his own name and not in trust. oddly though, when i tried to open the account in my son's name the system wouldn't allow it - I was told it HAD TO BE IN TRUST and that it wasnt possible for my son to open it himself!
And thats not all...
they suggested opening a sav4it account to drip feed the regular saver which I duly did. later that day i received a phone call from the halifax to advise that the standing order could not be set up from the save4it account and i would have to arrange the standing order from another exisiting account (from our own bank since we are not with the Halifax ourselves).

i now have to decide whether to keep the save4it which already has
four hunderd pounds in, and also whether i should set up a standing order from my own account to drip feed the regular saver which I have already started off with one hundred pounds.
alternatively, i could just put it all back into his Nationwide Smart account which is still one of the top interest payers?

HeadKM

I am trying to work out if it is better to put savings for our son in a best buy children's account (once he has earned above the £100 allowance) or put it in a higher rate adult account
I am therefore trying to compare approx 6.3% (best adult savings) against approx 5.5% (childrens' account)
Also National Savings childrens tax free bond is 5.10%
so out of these 3 options which would be best?
Can anyone help, please?
Many thanks
Katie

Sky_Digiman

Why do Nationwide advertise a "Welcome Pack" on there website AND a Discount Booklet, when i only got the Discount Booklet :P

amilie*

Hi,

I was just wondering if anyone has any advice about Child Trust Funds?

I have received my child's voucher and I'm not sure which account to open- there seem to be so many to choose from.

We also have some other money that has been given to her, should we put this in the same account or should we open another savings account? I don't really understand the difference between a Child Trust Fund and a savings account?

Thanks,

Mikeyorks

amilie* wrote: »

Hi,

I was just wondering if anyone has any advice about Child Trust Funds?

Immediately above this thread .. there is a link to Child Trust Funds : reproduced here for ease

http://www.moneysavingexpert.com/savings/child-trust-fund-vouchers

White_House

Please could you advise me what the best option is for saving 'lump sums' for children who are in full time education (ie. do not pay tax) over 16? I have a 17 yr old and a 15 yr old (who will be 16 in Sep) and would like to invest a lump sum for them each. Best deals please??