Children's accounts

Grandad2b

I see Halifax pays 6% for a year on upto £100 per month for children's accounts. The money then goes into a regular saver account that pays 3%. Is there anything to stop me opening another account at 6% after the year is up? And the following year? Or should I put the money into Zopa?

jimjames

How old are the children?

If you are prepared to risk money in Zopa have you not considered share based investment plans?

Mimi_Arc_en_ciel

Nothing at all stopping you from doing that (I've already asked this question )

Grandad2b

jimjames wrote: »

How old are the children?

If you are prepared to risk money in Zopa have you not considered share based investment plans?

There's a clue in my username but of course you're right to ask. In a year I expect him to be about 10 months.

My other half invests in stocks and shares. She bought some unit trusts just at the top of the market in 2008. They came back to being worth what she paid for them about a year ago. Since then they've done very well but who can tell me when the next crash will be?

By comparison the returns and risk on a few thousand in Zopa seem quite reasonable to me, particularly for a non taxpayer.

jimjames

Grandad2b wrote: »

There's a clue in my username but of course you're right to ask. In a year I expect him to be about 10 months.

My other half invests in stocks and shares. She bought some unit trusts just at the top of the market in 2008. They came back to being worth what she paid for them about a year ago. Since then they've done very well but who can tell me when the next crash will be?

By comparison the returns and risk on a few thousand in Zopa seem quite reasonable to me, particularly for a non taxpayer.

Unfortunate timing but if there is no loss in 5 years despite one of the biggest recessions in recent times then I think that is not a bad result. Worst thing would have been to sell, better to have bought more when they dropped.

Each to their own but investing over a long period means you buy during the dips as well as any peaks. You also get dividends which compound over time too.

bowlhead99

jimjames wrote: »

Unfortunate timing but if there is no loss in 5 years despite one of the biggest recessions in recent times then I think that is not a bad result. Worst thing would have been to sell, better to have bought more when they dropped.

Each to their own but investing over a long period means you buy during the dips as well as any peaks. You also get dividends which compound over time too.

Exactly. Buying at the peak of a market is unfortunate but most purchases are not made at the peak of a market, it's quite unlucky.

Markets go up and down all the time which is why you get paid a premium, in terms of returns, for making stocks & shares -based investments, because there is some risk compared to cash.

However, most people investing for their new grandchild are investing for their new grandchild to spend it when they are 16 or 18 or 21. They are not just looking to put it away until the child is 5 and the market has taken a bit of a tumble and only just recovered.

The compound return over 20 years on shares is something that has always beaten cash. It isn't guaranteed, and it might be shortsighted to assume that the way the world has worked in the past will always be the way it will work in the future. But it is the whole basis on which people are able to invest through pension schemes for retirement. Put away a very small fraction of your salary for a few years, get back a larger fraction of your salary for the rest of your life. The pension schemes do not achieve these results by holding cash deposit accounts or having little parcels of cash invested in Zopa. They use stockmarket based investments.

nande2000

Hi, are there any products specific to children where you don't have to review the accounts every 12 months. I've got 3 young children and its getting a bit tiring to visit the bank branches in question every 12 months to get the best rate.

xylophone

If your concern is interest rates, then you do need to keep an eye out for changes, and this could be more than once a year, unless you have a fixed rate?

Archi_Bald

nande2000 wrote: »

its getting a bit tiring to visit the bank branches in question every 12 months to get the best rate.

Check on the internet instead?

jimjames

nande2000 wrote: »

Hi, are there any products specific to children where you don't have to review the accounts every 12 months. I've got 3 young children and its getting a bit tiring to visit the bank branches in question every 12 months to get the best rate.

Use investment products instead then you won't need to check interest rates.

nande2000

When you have 3 kids, with savings accounts set up at various times of the year it gets a bit tedious to check these products. Are there any internet Child accounts ? That would be better but i'm finding you have to go into the branches to get them setup. All a big scam by the big banks methinks.

Investment accounts are too risky for this kind of thing, I guess the simplest answer is premium bonds.