Best way for a couple to save

Fatcat1974

Hello, newbie here looking for help.

My partner and I (unmarried) want to put away our child benefit money, potentially to pay for our kids' university costs.

If it was me alone, I'd probably put the money into an equities ISA to benefit from the tax-free allowance and hopefully to see the most growth, given that the investment would be long-term (17+ years).

I've read that you can't have ISAs in joint names (stands to reason). So what's the alternative option for a couple? And will my current ISAs have an impact on my options? I currently have a small cash ISA and an equities ISA. I don't plan to put money into either of these at the moment.

I hope somebody can offer some advice.

ses6jwg

If you are saving on behalf of a child it should be tax free in any case.

Halifax currently do a 6% regular saver which allows you to save up to £100 a month via standing order, Principality do a similar scheme.

You could open a fixed rate bond as a Trustee also if you have a lump sum.

Reaper

How about using the Child Trust Fund? You add your own money as well as the £250 the government starts it off with. It can go into a savings account or the stock market as you see fit. The child gets it at 18.

More details here:
http://www.moneysavingexpert.com/savings/child-trust-fund-vouchers

Gymgenius

Reaper wrote: »

How about using the Child Trust Fund? You add your own money as well as the £250 the government starts it off with. It can go into a savings account or the stock market as you see fit. The child gets it at 18.

More details here:
http://www.moneysavingexpert.com/savings/child-trust-fund-vouchers

..and there is the downside to the CTF.
many parents (me included) want to decide what to spend the money on, and when to spend it.

Fatcat1974

Gymgenius wrote: »

..and there is the downside to the CTF.
many parents (me included) want to decide what to spend the money on, and when to spend it.

Exactly! We have CTFs for both our kids and we add to them each month, but you don't get a say on how they spend the cash when it matures.

Thanks for the advice on the regular saving accounts. I'll look into those. The key for us is that the money must remain ours so that we can decide how it's spent.

Lokolo

Fatcat1974 wrote: »

Exactly! We have CTFs for both our kids and we add to them each month, but you don't get a say on how they spend the cash when it matures.

Thanks for the advice on the regular saving accounts. I'll look into those. The key for us is that the money must remain ours so that we can decide how it's spent.

If you bring them up well enough you won't need to

Although saying that I am the complete opposite to my brother! He gets £500 a month, no rent, no bills (lives at home with mum), and saves none! I am on £1200 a month, pay bills, rent etc. and save £500 a month! Crazy.

Reaper

Fatcat1974 wrote: »

Thanks for the advice on the regular saving accounts. I'll look into those. The key for us is that the money must remain ours so that we can decide how it's spent.

Ah, you missed that key fact when you stated your criteria, otherwise as you were thinking of Univeristy an account that paid out at 18 would have been ideal.

You have to think about tax. If you are tax payers then interest has tax deducted from it unless it is set up in trust such that the child's tax allowance is used. However as soon as you set it up in trust any money you put in immediately belongs to the child and at a certain age they will be allowed to withdraw it.

The Halifax Children's Regular saver mentioned is such a "trust" product. When you withdraw the money you are only allowed to send it to another account that is also in trust. That is because once you have put the money in it is no longer yours. In the case of the Halifax I believe the child gains control of it at 16 (though you had best check) which is even worse than the CTF.

On the other hand if you did one in your own names instead so you kept full control you would not be allowed to get the 6% paying account. In fact the Halifax non-child's version only pays 2%!

lingwood

fatcat1974 wrote:

Best way for a couple to save?

Dont let her have any money or cards:rotfl:

Primrose

Knowing how financially irresponsible most children are when they reach 18 I think Child Trust Funds are to be avoided like the plague.

ses6jwg

Primrose wrote: »

Knowing how financially irresponsible most children are when they reach 18 I think Child Trust Funds are to be avoided like the plague.

Mine is in the Leeds and Holbeck BS and can only be operated by Passbook.

If I keep this hidden even after she is 18 - does this count as theft ?

Gymgenius

ses6jwg wrote: »

Mine is in the Leeds and Holbeck BS and can only be operated by Passbook.

If I keep this hidden even after she is 18 - does this count as theft ?

Basically, yes. IIRC, the definition of theft is "Dishonestly appropriating property belonging to another, with the intention of permanently depriving the other of it."