Is it worth opening a savings account for my daughter?

Jharkinton

After carefully looking at what is on offer in the banking markets I'm stuck with the question 'Is it really worth saving for my daughter?'

I've seen Halifax is doing a childrens ISA with 6.00%

But as we all know why would the bank give this much compared to everyone elses 1.75% - 2.00%

Is there a guide to these on MSE that someone can recommend reading please?

New to savings. Only have specialist skills in spending

MoneySaverLog

Jharkinton wrote: »

I've seen Halifax is doing a childrens ISA with 6.00%

But as we all know why would the bank give this much compared to everyone elses 1.75% - 2.00%

Simplez they want your money as a customer too

R_P_W

Well what is the alternative? Not saving because it isn't worth it? Interest rates may be low but better than spending every penny

innovate

Jharkinton wrote: »

Is there a guide to these on MSE that someone can recommend reading please?

Yes there is............................................................

xylophone

https://www.gov.uk/child-trust-funds/overview

Check whether your daughter is eligible for CTF or JISA.

It may be possible (after the current consultation period) to transfer CTF to JISA but this will require a change in the regulations and will probably not take place for a year or so. http://www.ftadviser.com/2013/03/20/investments/savings-and-isas/more-joy-for-the-jisa-as-ctf-transfers-seem-possible-Kb9nv6fgm7bWNd35NiNj2K/article.html

If saving for your child outside a tax privileged account like CTF/JISA, bear in mind the "£100 rule" see here http://bank.virginmoney.com/savings/learn/childrens-accounts/

The Halifax cash JISA rate (available if the registered contact (but see rules when child is 16+) has an ISA with them) is the best available at the moment by a very long way. http://www.halifax.co.uk/isas/

If the child is very young, you may prefer to consider the stock market option for all/part of the allowance. http://www.hl.co.uk/investment-services/junior-isa http://www.juniorisaproviders.org/

atush

And of course, depending on the age of your child, and what/when the money is for, it might not be best to save in cash at all?

lindseywatson

I am considering setting up a tax free savings account for my daughter (6yrs). We already have the Child Trust Fund, but I am looking into opening up a tax free account for her also. Despite banking with HSBC I think I am going to go with Sheffield Mutual - with them bothy myself and husband can apply for a tax exempt plan. Does anyone have any experience of Sheffield Mutual that they could share with me?

jimjames

lindseywatson wrote: »

I am considering setting up a tax free savings account for my daughter (6yrs). We already have the Child Trust Fund, but I am looking into opening up a tax free account for her also. Despite banking with HSBC I think I am going to go with Sheffield Mutual - with them bothy myself and husband can apply for a tax exempt plan. Does anyone have any experience of Sheffield Mutual that they could share with me?

The only comments are not to touch a tax free savings plan. Very poor value for money, poor performance and very inflexible with the tax free bit a complete irrelevance to most people.

If you use a Junior ISA or even your own ISA then you have complete control with flexibility and generally lower costs.

jimjames

Jharkinton wrote: »

After carefully looking at what is on offer in the banking markets I'm stuck with the question 'Is it really worth saving for my daughter?'

I've seen Halifax is doing a childrens ISA with 6.00%

But as we all know why would the bank give this much compared to everyone elses 1.75% - 2.00%

Is there a guide to these on MSE that someone can recommend reading please?

New to savings. Only have specialist skills in spending

Depending on her age you may want to look at share based schemes not cash.

The 6% is genuine with Halifax and is the real rate they pay.

atush

lindseywatson wrote: »

I am considering setting up a tax free savings account for my daughter (6yrs). We already have the Child Trust Fund, but I am looking into opening up a tax free account for her also. Despite banking with HSBC I think I am going to go with Sheffield Mutual - with them bothy myself and husband can apply for a tax exempt plan. Does anyone have any experience of Sheffield Mutual that they could share with me?

If your child has a CTF, you cannot open a JISA for them.

You and/or your OH can have an isa though/

atush

jimjames wrote: »

Depending on her age you may want to look at share based schemes not cash.

.

Yes, was I was alluding to in post 6