Nest-egg for my little girl?

squashy

I am completely clueless about investments and so wonder if I can get some advice.

I want to set up some kind of fund for my nine year old daughter for her to recieve when she is 18. She did not qualify for the CTF as she was born before they were introduced. But I was thinking of something along a similar line.

My daughter is severely deaf and we have recently been lucky enough to be awarded DLA for her. We intend to use the money to enrich her life as best we can but part of me feels that she might struggle much more when she is a young adult. If we had put some of this money aside for her then maybe we could get her driving for example.

What are people's thoughts on this?

opinions4u

Good thinking.

How much are you looking to set aside each month?

I would be tempted to look at putting the money in to a bare trust with somebody like Alliance Trust.

There are numerous options though, and a trip to a reputable local IFA may not be a bad idea given the circumstances.

squashy

http://www.engagemutual.com/junior-easy-save-glance.asp?ref_code=JESWBAF8&utm_source=DGM&utm_medium=Affiliate

I came across this, it looks reasonable given that is has a guaranteed return?

I was thinking £30 a month maybe.

I have a moral dilemma too- we have 5 children of which only the youngest has a CTF. Assuming we invest for Amy the others 3 will be left out. Hmmm!

Lokolo

squashy wrote: »

http://www.engagemutual.com/junior-easy-save-glance.asp?ref_code=JESWBAF8&utm_source=DGM&utm_medium=Affiliate

I came across this, it looks reasonable given that is has a guaranteed return?

I was thinking £30 a month maybe.

I have a moral dilemma too- we have 5 children of which only the youngest has a CTF. Assuming we invest for Amy the others 3 will be left out. Hmmm!

The gaurenteed return is the amount you put in. So a minimum of 0% interest.

Minimum of 10 years also. Bear this in mind.

dunstonh

Friendly society plans are also quite expensive and not very attractive in the returns department any more.

The "tax break" isnt that valuable at all and the charges will hit it harder.

Stuart_W

My wife and I have set up a Future Fund Savings Account from the Co-Op bank for our three nieces.
The interest rate is now quite dreadful (I think it's just gone down to under 2% - it was over 5% when we opened it) but on the other hand some other accounts designed to do the same thing have actually gone down in value, or as Lokolo has stated guarantee a return of no more than 0% interest!
http://www.co-operativebank.co.uk/servlet/Satellite/1193206376531,CFSweb/Page/Bank-Savings

If she is now nine years old, and you save for a full nine years from now, every 85p you can save per month will become £100 - based on the current pathetic 1.75% gross interest rate. £85 per month would become a balance of £10,000. Of course interest rates could change but it is the saving a small amount over nine years that makes the difference.

This is why we set the account up - it is the saving each month without fail that makes the biggest difference. It's also completely flexible - change amounts each month as you wish. And as a child's account, remember to register for it to receive interest tax-free

I would therefore suggest any children's account from a bank or building society that you trust. Most offer something similar to the kind of account we've gone for with Co-Op.

Hope this helps.

Stuart_W

squashy wrote: »

I have a moral dilemma too- we have 5 children of which only the youngest has a CTF. Assuming we invest for Amy the others 3 will be left out. Hmmm!

The way we sorted this one out was to decide on "X amount" being the amount that each child wil hopefully have on their 18th birthday, and then doing some clever maths worked out how much to pay per month for children's savings accounts for three children aged 11, 6 and 4. We are paying three very different amounts due to the different length of times involved. We didn't think it would be fair to say...
Child A... you're lucky, your investment has done well and we can give you £xxxxx to start you off.
Child B... you're not so lucky, but your investment is still worth what we put in so here is £xxxx to start you off.
Child C... unfortunately, your account has been adjusted to abnormal financial conditions and is currently in deficit. This way to the workhouse.......

Due to variable interest rates there may need to be a little bit of topping up to each account on each 18th birthday, but we wanted to make sure each child was given exactly the same (OK I know that due to inflation technically that all receiving the same amount doesn't actually mean the same but I think the easiest concept of fairness is that they all actually get exactly the same amount of money).