Accounts for children

liz-paul

Hello, hope I am posting this in a relevant place!
I currently have a Child trust fund for my son who is 2 yrs old. I have added some money to it but not sure how much it is all worth at the moment & am about to transfer to another provider as I don't like my own one.
However I am wondering if I should open another acoount for him so that he/we can access the money any time. I like the fact that we have to keep the money for him in the ctf & can't spend it ourselves but at the same time feel that might not be practical & also we can't predict now what he will be like at 18! If I opened another account I'm not sure whether it should be a current account or savings account (I assume he'll need a current account at some point for buying toys with his birthday money etc) or a savings account. Also should it be in his name or my name? Surely if its in his name he'll be entitled to the money at 18 just like a ctf, or will I have the option of removing the money before then & keeping it? (I'm not trying to 'swindle' my son btw). Then if it was in my name would i pay tax on the interest? I don't pay tax at the moment as I'm a full time mum but I may well return to work in the future.

Or does all of this mean I should have a ctf account, a savings account & a current account? Whcih is a lot of accounts to keep track of on top of my own & with baby no 2 on the way which will need its own accounts! I am very confused & not that clued up on financial things. Sorry this has been such a long post! Also any suggestions for good accounts to open would be appreciated :-)

Rachel83

I was under the impression that the £250 you get off the government for your childs trust fund is untouchable by the parents, meaning only the child has access to it at 18... or higher if you chose to invest it until they are older.
I guess best case senario is stop adding to the trust fund, open his/her own account and add to that one. I'm sure that the people you will talk to in the bank will be able to assist with which account is better for your situation But i'm pretty sure you can't now touch any of the money in the ctf as it's the childs to use when they are older

liz-paul

Hi, yeah thats right we can't get any money back fro mthe ctf thats been paid in already. I'm just wondering if we'd be better off making future payments into a more flexible account......

Money_maker

We have an account with Halifax that you pay in to each month - you can vary the amount. After 1 year it transfers down into a regular childs savings account. You cant touch the money in this account until it transfers down but it pays 10% - a good rate in current times. The regular savings account can have withdrawals/deposits as instant access and the interest rate is lower. Child has option to run account when 12 years old or parent can keep control.
You wont need additional current account.

Am concerned as to why you think you can keep the money? When an account is held in trust, the money belongs to the child.

If you want a savings account so you can 'keep the money', open an adult one in your name.

Krystaltips

DD has a savings account in her name and I am trustee of it. I will give her access to this account when I feel she really needs the money (car, university etc) I don't add to the CTF, that is free money from the government that she can do what she likes with when she's 18 (drink it or spend it on clothes and makeup probably)

sarahsarah

I am thinking the same thing for my 19 month old.
I am thinking that when she's 18 she'll probably like to treat herself and not think ahead for university/moving out/getting married or whatever, so I'm going to have an acount in my own name and then I can transfer money over to her as and when, eg if she is at uni she an have a monthly allowance from it etc.

ETA I think this is quite common in america, well on tv and in books et they all seem to talk about their parents having a college fund/wedding fund for each child. Seems sensible to me!

Katyag

DS1 is 7 and was born before the child trust funds started so he didnt get that but he has a childs savers account in his and DH's name which his birthday/christmas/any extra money/LTSB save the change/copper jar all goes into.

DS2 was born after the child trust funds started so he got that and we put it into Britannia but we wont add anything to it since DS1 didnt get it so dont think it would be fair. He also has a child savings account the same as DS1 which his birthday/christmas/any extra/£2 coin collection goes into.

The also have just over £2k locked away in a high interest term thing to be split between them when we feel is an appropriate age/time.

How come our kids have more money than us!! lol lol

Money_maker

Katyag wrote: »

How come our kids have more money than us!! lol lol

So they can pay for our care home! :rotfl: :rotfl: :rotfl:

Krystaltips

When I was a baby my Mum and Dad opened a savings plan in my name... When I turned 16 I received a nice cheque for about £1800... My Mum then accompanied me to the bank and helped me cash it... I never saw a penny... And I would never do that to any of my children!

Katyag

Krystaltips wrote: »

When I was a baby my Mum and Dad opened a savings plan in my name... When I turned 16 I received a nice cheque for about £1800... My Mum then accompanied me to the bank and helped me cash it... I never saw a penny... And I would never do that to any of my children!

Ive heard something similar in my family!:eek: My aunt told me (it was her, my uncle, my grandparents and my great uncle that put money away for me and my brother) that there was another account for me and my brother but when my parents moved house when I was 7 and he was 2 they cashed it in to help with the move! Decorating and the like!

The small financial start in life i have had from the family mentioned above and nothing from my parents. I intend to see its different for my boys!

liz-paul

Hi, thanks for your replies. I am not trying to 'keep his money' as I tried to make clear but am concerned about saving a large chunk of money to be handed over when he is 18 no matter what. You cannot predict what will happen to your children & you don't want to be handing over thousands of pounds to someone involved in drugs, crime, gambling, who's being blackmailed etc etc. Hope that I am making myself clear now, I know I am not the only person with these concerns about the ctf. Anyway I have a few things to think about before I make my decisions, thanks.