Grandparents Saving for Children

calypso_rhapsody

You could just invest in your own name and then gift or leave in your will (with Trustees if appropriate) - that gives you complete control and allows for circumstances where you lose contact with the child. The income would of course be yours so there would be a tax cost (unless you put it in a tax-sheltered form such as ISA or NS&I bonds) but is that all that important compared to the issues that could arise in the future if the funds are in the name of a child that you have lost contact with?

suelees1

Tony I've sent you a private message

atush

I use an investment trust for my 3. It is in my name and I have control and they are designees.

Make sure you tell the child you have money invested for them= age 9 is old enough to remember. Will give them a reason to contact you when they are old enough, should they want to.

Set up a simple webpage with email address, and give them the details (make it something easy to remember) in case they want to contact you-they will have access to computers at school, libraries etc.

jackyann

jimjames wrote: »

Personally I would avoid any friendly society plan such as this. They are expensive with high charges, inflexible with fixed terms and amounts and do not allow you to start and stop at will.

In contrast an investment trust plan will allow any number of lump sum payments, variety of investment choices, low cost and can start and stop monthly payments at any time. I use various ones and have found them very flexible.

Thank you, i shall certainly take this into consideration - as you see, I know more about adoption than finances!

And OP - obviously you are not telling us the circumstances, but 9 is old enough for the child to have a view about keeping in touch with you. This can be done, if felt to be in the child's best interests, a delicate decision. If there is no direct contact, you can ask if Social Services will pass on letters to her, say once or twice a year - this also depends on many individual factors, but do take advice.

jimjames

jackyann wrote: »

Thank you, i shall certainly take this into consideration - as you see, I know more about adoption than finances!

Apologies if my reply appeared abrupt. Unfortunately some of these savings plans which claim to be something good value because they are tax free are nothing of the sort and can end up tying you in for the full term or leave with a lot less than you paid in if you cancel early.

tonybraines

phred wrote: »

I have opened ISA accounts for my grandchildren but they are in my name.
I have made a will and left named accounts to them.

This gives me control over the accounts, (unless I die :eek:), I can add to them if I wish and I can change my mind if the kids turn out to be wasters.

Thanks Jackyann this makes perfect sense. I have had previous experience with Family Investments and after payin £15/month for 15 years it made a return of roughly the amount I had paid in less inflation.

Investing in my own name and keeping control seems to be the best option by far, especially as you say It may need a Will to make the payment at the age I stipulate.

tonybraines

atush wrote: »

I use an investment trust for my 3. It is in my name and I have control and they are designees.

Make sure you tell the child you have money invested for them= age 9 is old enough to remember. Will give them a reason to contact you when they are old enough, should they want to.

Set up a simple webpage with email address, and give them the details (make it something easy to remember) in case they want to contact you-they will have access to computers at school, libraries etc.

Thanks very much - the idea of them having an email address for future contact is an excellent one, the freedom of investment also makes perfect sense.

A.Jones

tonybraines wrote: »

I have looked at Junior ISA's... plus the money automatically goes to the child when 18 which is too young.

It doesn't, it goes to the adult at 18.

jackyann

jimjames wrote: »

Apologies if my reply appeared abrupt. Unfortunately some of these savings plans which claim to be something good value because they are tax free are nothing of the sort and can end up tying you in for the full term or leave with a lot less than you paid in if you cancel early.

Oh no, not abrupt at all. I am finding my way through this maze and have found you guys very helpful indeed. I try to post a few replies on the other topics that come up here as a sort of quid pro quo.

Although not especially helpful to OP, I am looking forward to the debate on Junior ISAs. It seems that for the majority of kids (ie: non-tax payers), the big advantage is that money will be tax-free at age 18, and continue to be so until used; whereas an ordinary savings account will become subject to taxes.

And back to OP: I do suggest you discuss this difficult situation with an independent expert in adoption such as the charities I suggested. A financial or legal expert will give you their expert point of view, but you do need a more rounded approach.