Savings for children

davep123

Hi,

I am looking at investments funds for a soon to arrive baby & a 14 year old.

bit of a lump sum (less than 2k) plus regular monthly input

I'd rather invest the money with low or 0 risk,

I am happy with committing to no withdrawal's for each 12 months.

I've looked at ns&I but the rates seemed very low.

Any suggestions ??

Alter_ego

In the case of baby, surely you could commit to longer than 12 months? For better interest.

davep123

Yes probably could, if so can you recommend anything ?

lilac_lady

I recommend that a condition is that you don't get told if they spend it in a fortnight when they get hold of it! iIve told my children not to let me know if my granchildren do just that with the monthly payments I put into their trust funds.

opinions4u

Regular amounts: Halifax Kids Regular Saver paying 6% (£10 to £100 a month) - make sure you decide what to do with it at maturity.

Easy access amounts: Northern Rock Little Rock account paying 3% or Bath Building Society 5% (limited to £500).

Lump sums: Again, look at what Northern Rock do for kids, or Halifax Guaranteed Reserve.

jimjames

davep123 wrote: »

Hi,

I'd rather invest the money with low or 0 risk,

I am happy with committing to no withdrawal's for each 12 months.

I've looked at ns&I but the rates seemed very low.

Any suggestions ??

The problem is your 3 statements are mutually exclusive (in general) Low risk/no risk savings have lower rates that those that have some risk attached. You may have the capital there but inflation will be reducing it constantly at the current savings rates vs inflation. Over the timescales you are considering for your baby then some risk could be acceptable. If you are saving until they are age 18 then why would you want no withdrawals in 12 months?

If you are looking long term then share based accounts may give better returns but do have possible risk to the capital. Alternatively if you haven't already used your own ISA allowance then might be worth making the most of that first.

The ones I use are F&C and Aberdeen. Highly flexible, access when you want and no issue with starting/stopping or adding lump sums. I'd avoid any of the tax free bond schemes as they are generally very poor value, inflexible with high charges.

More info on the links below, some pointers even if you dont use their schemes. Another option is to use your own ISA if you haven't already used up the allowance

http://www.fandc.com/new/it/Default.aspx?id=78401

http://www.aberdeen-asset.com/aam.ns...investchildren

kidmugsy

Consider bunging the lump sum into ns&i Index-Linked Savings Certificates for the older child and making the monthly savings for the youngster.