Savings & Investments for our children

Mart+Sar

We are looking to save for our children through two sources:
i) gifts from our extended family; and
ii) savings/investments we would like to make on their behalf.
We don't want to put gifts from others (i above) at risk therefore we want to avoid stock market linked vehicles but we are open minded on this point in terms of savings/investments made by us.

Any recommendations?

jonnyb

You are likely to get quite a few replies on this subject, as it regularly comes up.
First thing many posters will probably say is that by avoiding risk of stocks and shares, you run an alternative risk or inflation eroding any growth in "safe" money put away in savings accounts, given the pitiful interest rates on offer, so think carefully about that.;)

You might like to give an indication of the amounts to be invested, and age of the children, or planned length of investment, so other real experts can give their advice.

I have taken the shares approach for my 2 kids, and invest £100 per month in a self select isa ( in my wife's name, as we will never use her full allowance - so we control when we give the money to them as well). The regular investment cost is only £1.50 per transaction, and I am slowly building shares in "safe" companies like Vodafone, United Utilities, and even took a small gamble on Barclays and Aviva.
With a little research it is easy to find shares where the dividend is approx. 5% and real share growth over many years comes from automatically re-investing the dividends. Look on iii.co.uk, fool.co.uk for starters.

Statistically, even with stock market dips, shares have outperformed cash in almost every situation, looking over something like 12 to 18 years.

Good luck whatever you decide.:)

xylophone

Be careful of the "£100 rule" - this does not apply to CTF/JISA.
http://www.direct.gov.uk/en/moneytaxandbenefits/managingmoney/planningyourpersonalfinances/dg_10013916
http://www.hmrc.gov.uk/tdsi/children.htm
https://forums.moneysavingexpert.com/discussion/comment/54727765#Comment_54727765 post 7

DiggerUK

Mart+Sar,
Get your family to gift gold Sovereigns or Britannia's. As UK legal tender they are VAT and CGT free.
They come in 10 different sizes from about £65 up to £1000.
They are nothing to do with the stock market, and you can keep control of when they get them.
..._