Secret saving for children

nd123

My wife and I gained our first niece a few months back, and have decided we would like to save a little each month for her future.

We can only afford to put aside £10 per month, but over 18 years we're hoping this will accumulate to a reasonable sum for her. The catch is that we don't want to tell her parents that we are doing this so presumably can't invest in anything in her name. So for all intents and purposes I want to save £10 a month for 18 years in my own name.

Given the investment term involved I would ideally like to invest in an index-tracking fund or similar, but can't find anyone that offers plans from £10 per month.

Does anyone have any suggestions for the best way to achieve a decent long-term return on such a modest monthly saving?

Many thanks in advance...

MoneySaverLog

You could put away the £10 a month and save up and then when you reach a reasonable amount move it into the tracker then ;-)

Avoid the friendly societies.

nd123

MoneySaverLog wrote: »

You could put away the £10 a month and save up and then when you reach a reasonable amount move it into the tracker then ;-)

I thought about this. It's a possibility but I thought maybe a little on the messy side... it would take >4 yrs to save up £500, which seems to be a minimum tracker lump-sum investment. Then I'd have to think about how to handle the £10 monthly savings after that. Is there a simpler way?

Prothet_of_Doom

Why would you not tell the parents ?

It might take some financial pressure off them. Or they might agree to match what you put it, or they might overpay thier mortgage instead of paying into a savings account for the kids, or .....

I was the parent, who was surprised when granny, gave his son enough money for his university fees, and struggled to understand why they didn't tell me. Had I known I might have prioritised our financial arrangements differently. They might have had better holidays. LOL

nd123

Good point. But the parents are reasonably well off. We are quite close to my wife's brother and sister-in-law and I am fairly sure the amount of money we will be talking about would not significantly change their financial plans. However, if that situation were to change at all I would definitely consider telling them...

We just wanted to be able to give our niece something significant when she grows up :-)

Kayalana99

Wish I had the answar to this as I am wanting to save 20k for my two children (10k each) for when they are older, but don't want it in thier name as I want it to go towards a house or something similar so it won't be given to them when thier 18 hence not being able to put it in thier name.

Maybe seem a tad controlive but me and my sister were given 3k each and she spent all hers within a few weeks on 'having a good time' and Im not saving my whole life to fund a booze hoilday for them but a future

So far I've settled on just putting it in a savings account thats got 3% interest....but I really would like something thats '£10 a month' and so much at the end of 5 years or so and repeat..

Prothet_of_Doom

I think you should say, I'm putting something aside for said child, not sure what it will be, but it's unlikely to be massive. I'll let you know when they are 15 how much it's likely to be, and we can discuss the best time to give it to them.
Leave it at that for now.

Kayalana99

I've been looking at 'regular savings' maybe someone you should look into if you want to build up 500/1000 first before investing it elsewhere? You basicly pay your £10 a month and it works out better interest.

Ones I have found tho are all 12 months or so..

atush

I like investment trust savings plans. Low cost, but goes into equities, not cash. Has given my children great returns over the last decade+/

But don't know of ones that start at 10/m, but do know ones (invesco perpetual) that start at 20?

notanewuser

Kayalana99 wrote: »

Wish I had the answar to this as I am wanting to save 20k for my two children (10k each) for when they are older, but don't want it in thier name as I want it to go towards a house or something similar so it won't be given to them when thier 18 hence not being able to put it in thier name.

<snip>

So far I've settled on just putting it in a savings account thats got 3% interest....but I really would like something thats '£10 a month' and so much at the end of 5 years or so and repeat..

3% interest is only just covering inflation, it's not actually "growing" the investment. And if it's in your name you'll also pay tax on the interest earned.

At £10 per month it will take you 83 years to save £10k.

psychic_teabag

Halifax seem to have a kid's regular saver offering 6%, on at least £10 per month, if that's any use. Not investments, but seems a pretty good rate.

Do you have your own S&S ISA ? Suppose you put £40 per month for yourself + £10 for the child, then at any time, 1/5 of the value of the pot is the child's.