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Pension for a child

Alan_T_2
Posts: 101 Forumite


I'm looking to start putting some money away for my daughter, aged 5, and given the potential changes to my pension scheme, and likely lack of any decent schemes available when she is working, I thought that considering a pension may be the way to go.
What are the things to consider with regards to starting a pension for a child?
Edit to add - One thing to throw into the mix is that would it be possible for both parents to do this separately? Or would they need to contribute together?
What are the things to consider with regards to starting a pension for a child?
Edit to add - One thing to throw into the mix is that would it be possible for both parents to do this separately? Or would they need to contribute together?
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Comments
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1) The maximum contribution into a child's pension is £3,600 (including tax relief, so £2,880 net).
2) Most providers will allow two contributors, even if it means sending them a cheque.
3) Anyone can be the contributor.
4) Make sure it's a cheap pension.
5) You might consider a multi-asset fund aimed towards higher-risk investors because a) you need a nice spread of assets and b) the younger you are, the more risk is acceptable, generally.
oh, and it's a good idea - along with a Junior ISA0 -
There might be exiting possibilities later on transfering into a family SIPP, which combines the investments, and also opens up possibilities for inheritance planning. Especially so with a family business.
Or so I've read somewhere.This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0 -
I would only look into this after starting a Junior ISA or other equity savings that can be accessed form 18-25 when money would be needed for university, housing costs etc.
having a nice lump sum in a pension for your child at age 55, is a great idea. but if they needed the money earlier it could be a waste.0 -
Thanks all.
It is something that is being considered as part of a wider package of investments for her that hopefully willl stagger over her adult life. Going to get some advice on setting up trusts too.0 -
Going to get some advice on setting up trusts too.
Make sure it is expert advice from a solicitor qualified in wills and trusts
http://www.step.org/online-directory
See also http://www.hmrc.gov.uk/trusts/index.htm
In our family both a pension and other savings were set up for a child - when he started work, he contributed to his employer's pension while the "family" pension was transferred to a SIPP to which he continues to contribute .0
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