Easy savings for grandchildren

GMB61

Hi all

This is my first time at looking into savings/investments I am trying to find a way for my mother to open up some form of savings for 2 of her grandchildren ( not my kids ) and ensure that my brother or his ex cannot get at the savings and is it possible to lock the savings down until the kids are 18+. My mother has a small amount to start with ( left to her following my fathers recent death ) and needs to be able to add to the account as and when funds are available.

My mother in her 70's has only just got her first ever cheque book and pin card as my father controlled all the house finances for as long as I can remember so this has to be easy for her to do.

ReportInvestor

Hi GMB61 and welcome to the site ,

Why not get your mother to set up a bare trust with her and you as trustees? The children would get access to the money at 18. Investment Trusts like Foreign & Colonial would do the paperwork/legal stuff on this for free. The children's dad & mum are left entirely out of the loop (if possibly miffed - but only you know the state of family relations).

Your mum could also be a trustee on something like the Halifax 10% Regular Saver children's account (10% for one year only, then into a 5% account.) . It's best to have you down as an additional trustee in case your mum dies before the children are 18 & it then gets complicated.

One problem with a BS account rather than the Investment Trust "bare trust" scheme is that the children's mum could persuade her kids to put the Halifax money into their own name, and then persuade them to withdraw it (a worst case scenario).

Obviously the Investment Trust carries some risk, but if you combine regular saving with a decent length time scale you reduce the risk and open up the chance of a good return given compound growth over a (potentially) long time-scale, depending on the children's ages.

If they were 8, I'd go for 5 year regular saving contributions & then stop - leaving all the investments at least 5 years to grow from 13-18.