SAvings in son's name for Uni

sarahs999

Though my son is only four, we have started a savings account for his college fund. Various family members give us money for this at brithdays and Christmas,.

Bearing in mind this is avery long term savings account that we will not be making withdrawals from, what would be the best thing to do? Someone suggested investments are a good idea as over a 14 year period they are bound to grow, and that now is a good tiem to buy as everything is cheap. This sounded a bit simplistic to me and perhaps only half the story, but I have no experience in this area. Can anyone help?

Thanks
Sarah

itsallagame_2

What if he doesn't want to go?

Party time?
!

MsHoarder

Be careful here, any savings in his name become his at 18. Any parents of teenagers of that age can give you tales of 18 year olds who had big parties then needed separate help through university.

blackanchorage

You can open a unit trust with your son's initials as designation (a "bare" trust). It saves tax, though as others have said, it becomes his at 18 - if he knows about it.

I'd suggest equities for the long term, but my two children have lost money over the last few years!

Regards

Mikeyorks

If you and / or your OH don't use your Cash ISAs ..... that's a good place to put it .... if you want to keep it both from the vagaries of the investment market ...... and from your son, if you ultimately decide to give it as an allowance rather than a lump sum.

Would seriously suggest the former .... based on the unpleasant experience of mine blowing close to £10k in his first few months at Uni. If your's is 4 then he should have a CTF? You can add to that and move it into investments if you choose ..... and that potentially offers better growth. But it also puts all the cash into your son's hands at age 18.

Mine too, was adorable / sensible / trustworthy, and virtually up to the point he left to go to Uni. But the freedom, and other influences, turned him into a complete idiot for the first 18months. And it took several sleepless nights before I decided to bail him out with an allowance ..... rather than let the selfish little s*d drown!

And I'm still not convinced it was the right decision!

jem16

Mikeyorks wrote: »

Mine too, was adorable / sensible / trustworthy, and virtually up to the point he left to go to Uni. But the freedom, and other influences, turned him into a complete idiot for the first 18months. And it took several sleepless nights before I decided to bail him out with an allowance ..... rather than let the selfish little s*d drown!

And I'm still not convinced it was the right decision!

I think there is something to be said of the Scottish system where most go to the local university and stay at home.

sarahs999

Thanks for your thoughts everyone.

It will definitely not be handed over to him in a lump sum, but given in handouts each term (or to pay fees, or whatever is needed at that time). Good to know that it becomes his at 18; I might well transfer it out into a different account under my name when he's 17 and a half! I talked to the Halifax, where his account is at the moment, and they were keen for me to put it into an ISA too, so I guess that's what I should do. Presumably though they won't necessarily have the best deal, and also, that will only work up to £3000, is that right?

Lokolo

jem16 wrote: »

I think there is something to be said of the Scottish system where most go to the local university and stay at home.

Its free tuition.....

bob_a_builder

I think there is something to be said of the Scottish system where most go to the local university and stay at home.

and tuition fees are covered too for the scots, so lots to be said in favor of that scheme, rather than putting them in hock to the gov just as they start out

sarahs999

Quite. I'm hoping this system might be different by the time he goes, though given that he'll probably be part of the largest-owing generation ever, thanks to Gordon Brown's current actions, it's quite unlikley....

rb10

sarahs999 wrote: »

I talked to the Halifax, where his account is at the moment, and they were keen for me to put it into an ISA too, so I guess that's what I should do. Presumably though they won't necessarily have the best deal, and also, that will only work up to £3000, is that right?

An ISA couldn't be held in his own name - you have to be 16 to have an ISA. But if you don't have one yourself, you could open one in your sole name, where you keep the money that will become his. But, if you do this, and he gets cheques for christmas etc, these will have to be in your name and not his.

Halifax's Save4It is one of the best kids accounts, has instant access and a high rate. Childrens Regular Saver is 8% fixed if you can put in between £10 and £100 per month by standing order (even if this money is just 'recycled' from the Save4It, it gets a far better rate, for just a little effort!).