Use your child - best child savings account

rb10

Many 'adult' accounts are available to children as well, but do check the T&Cs, to see if there's a minimum age.

Any account held in the name of a child can be registered for tax-free interest, provided the child's income does not exceed the personal allowance (of £6000-ish).

For a starting point, why not look at the Halifax Guaranteed Reserve. It's available from age 0.

tinker_bell_2

hi, after looking around I opened a family regular saver with N&P (as discussed on "Best Child Savings" page). You have to have children to be eligible and I rang them prior to opening a/c to check about the R85, as the childs name cannot appear on the account. They advised this was okay due to the type of a/c it is. As I was transferring my childrens money from a Halifax Childrens monthly saver, where their name appeared alongside mine, I also rang HMRC R85 helpline to check that tax would be received gross. I was advised this would be fine as long as the money was for the children - which it is.
I opened the a/c, submitting my R85. However, they will now not accept this as the childrens name is not on the a/c. i have told them the money is for them and that I have again checked (this week) with HMRC and this is accepted as "looking after an account for someone else", however they will not budge.
Could anyone have any helpful hints please?

BigDavy

I was also considering N&P but was concerned about the tax position. As it is a family regular saver why can't the childs name be put on the account as with other childrens accounts? Anyone know the answer to this before I open. Halifax Reg Saver is not for large amounts - wanted to put Child Benefit into this account to build up a fund. Any ideas pls?

alang2101

I pay £30 per month into the Halifax children regular saver for my 2 children which is then transferred each year to the lower interest Save4it account. I renew the regular saver accounts each year. The rate on the Save4it account is much lower than the regular account, I presume I should be moving this money to a higher rate account, which one? I am tempted to put it into an ISA in my name but then I have the issue that it's not in the childrens name. The current balance is about £2500 each.

KennyT

We have twins that are about to turn sixteen. We've been paying the child allowance into their kids accounts (but earning pretty feeble interest!). What are the best options once they turn 16?

Thanks

K

andypandy1

alang2101 wrote: »

I pay £30 per month into the Halifax children regular saver for my 2 children which is then transferred each year to the lower interest Save4it account. I renew the regular saver accounts each year. The rate on the Save4it account is much lower than the regular account, I presume I should be moving this money to a higher rate account, which one? I am tempted to put it into an ISA in my name but then I have the issue that it's not in the childrens name. The current balance is about £2500 each.

With the Halifax regular savers you can transfer up to £100 a month. I would recommend that you use their accumulated savings to top up the monthly savings to the maximum. As an example I have 1 child who has 8 of these regular savers (mum/dad/ grannies/grandads etc) all receiving £100 per month. I am certainly not actually adding £800 of savings each month but what I did was gradually build up to this number of regular savers over a period of a year and basically I use the maturing proceeds on a rolling basis throughout the year to feed the SOs each month. I have 1 account from which I pay the SOs on a monthly basis and keep this account topped up as required as the regular savers mature over the year. So this system enables me to add a relatively modest sum to my son's savings each month whilst still benefitting from the high rate of interest on all his savings. He is quids in because he is earning between 6% and 10% on an average balance of approx £4-£5k rather than the paltry rates generally available for larger kids balances.

I appreciate that this may sound rather complicated but all the SOs happen automatically I just have a little file to remind me when to transfer maturing proceeds from the various accounts. Hope this makes sense!

heather8

baggins45 wrote: »

My child tax credits and family allowance is paid into a Nationwide Smart account paying a paltry 0.75%. There is £14000 in this account and I want to move it to a better paying account. Can I move this amount into another children's tax free account or am I better off paying into a higher interest rate account that I pay tax on? Does anyone know what the best account is?:eek:

You can put it into any account, just open the account in your childs name. If they are a non-taxpayer, make sure you complete a R85, so that no tax is deducted. If tax is deducted, you can still complete a R40 to claim it back from HMRC.

Little_Mama

Anon wrote: »

As all three are now back in Saveforit paying the pitiful 1%, could I move this into our offset mortgage for a while until the rates pick up?

Many thanks

Anon

Is this as a possibility? I wasn't sure of the legalities of this, as how could you prove the funds were being used for their benefit.

Any views anyone?

LM

angibson

I am looking for an online savings account for my 16 year-old daughter to replace one with ********* Building Society currently paying a paltry 0.1% gross! (Some years ago it was a top payer, but no more!) The amount to be saved is around £17,000, so it's the interest rate that matters, not the freebies, and my daughter's income is less than her tax-free personal allowance, so an R85 declaration for payment of gross interest can be made.

But although the best easy-access savings accounts are paying 3.15 - 3.3% gross inclusive of a 12 month bonus these all seem to be closed to children under 18 years old. The best childrens' accounts seem to be only 2.2% gross. So are the banks really giving children a good deal and trying to attract them as future long-term customers, or are they slyly making extra wonga from them by offering an interest rate that is only 65% of the rate that over-18s could get for 12 months and then "ditch and switch" to maintain high earnings? I get more than 3% fom all my cash savings by ditching and switching bonus accounts, so why shouldn't my daughter be able to do the same. It would be good financial education for her as well.

so, Martin, or anyone else - do you know of a top rate easy access bonus account that can be opened by under-18s?

rb10

Does she need the whole £17k to be instant access? Why not tie some of it up into a Halifax Guaranteed Reserve (minimum age 0) to get a higher rate?

She can open an ISA with £3600, and put a further £5100 into it in April. This way she can build up a tax-free saving pot for when she becomes a taxpayer. See here for some of the best.

And as for instant access accounts ... maybe this one at 2.8% which allows one withdrawal per year. As it's an internet only account, she'd need a child's current account to go with it, e.g. here.