Poor savings rates for the under 16s ? Why cant they have ISAs ??

HEIDIMUNCHKIN

I am trying to find the best place to invest a few thousand pound, which is my Childs Savings (currently only 0.95% (tax free) on 4K in the Nationwide ). :mad:
It seems you have to be 16 or over to have an ISA (where he could get a rate of 3%) is this correct??
If so will I be better off transferring it into my name (I don’t have savings) does any one have any advice. Many thanks

Baldur

HEIDIMUNCHKIN wrote: »

It seems you have to be 16 or over to have an ISA (where he could get a rate of 3%) is this correct??

Yes - the minimum age was reduced to 16 in April 2001 - http://www.hmrc.gov.uk/isa/bull1.htm

Reduction in the age limit

Investors aged 16 or over can, from 6th April 2001, subscribe to either a cash mini ISA, or the cash component of a maxi ISA.

'Mini' & 'Maxi' ISAs no longer exist (having become Cash ISAs & Stocks & Shares ISAs) but the minimum age limit does.

There are better rates than Nationwide's available on ordinary accounts for under-16s, see the usual comparison websites:

http://www.moneyfacts.co.uk/money/savings/14/childrens-savings-accounts.aspx
http://www.moneysupermarket.com/savings/
http://www.fsa.gov.uk/tables/bespoke/SavingsAccount

baby_boomer

ISA rates tend to be lower than adult best buys elsewhere.

Don't limit your choice to children's accounts. My son is sitting on 7% in a 3 Year Fixed Rate Bond and has other accounts paying even more.

Rates are no longer so good, but you can still hope to do better than 3% if you look around.

Milarky

Child Trust Fund cash accounts are available - and are much like ISAs for parents wanting to save for children - but only for children born after 1 September 2002. Thus there is a 'gap' in the market (children born between 1992 and 2002) who can't benefit from CTFs and are too young to open an ISA

(Government really ought to have thought that one through. There are several solutions - like allowing anyone born before 1 September 2002 to open a ISA, with a paying-in of £1200 pa until age 16, for example - but the lazy whatits couldn't 'make the time' for any of these no doubt)

opinions4u

HEIDIMUNCHKIN wrote: »

I am trying to find the best place to invest a few thousand pound, which is my Childs Savings (currently only 0.95% (tax free) on 4K in the Nationwide ). :mad:
It seems you have to be 16 or over to have an ISA (where he could get a rate of 3%) is this correct??
If so will I be better off transferring it into my name (I don’t have savings) does any one have any advice. Many thanks

You can get over 3% on a fixed rate account for a year.

Shop around at sites like www.moneysupermarket.com to identify the best offers and do a bit of digging to see if the best buys accept younger customers.

Don't forget things like Halifax and their Children''s Regular Saver account (8%) and their Guaranteed Reserve account will pay 3% on £500 - that can definitely be opened for a child. 3.05% for similar at Nationwide with an age minimum of 7.

dunstonh

Why cant they have ISAs ??

Three reasons mainly.

1 - You dont get an NI number until you are 16
2 - Most under 16s are non taxpayers so an ISA would be pointless
3 - It would encourage abuse by consumers.