help needed

flexingh

Hi everyone,

i have got a question for you experts and hopefully someone here can help me out.

i am looking to save and plan for my 2 childrens future my eldest is 9 and youngest is 4.
a typical course at university is around 3 years and i expect to hopefully give them £15,000 per year so i need your advice on the best savings method or investment method for this i have got some money ear marked and put aside in a normal low interest paying account.

a friend of mine also mentioned putting this in trust but as soon as he started saying bare and discretionary trust he had lost me, what is the benefit of having the money in trust and do i loose control over it


thanks in advance for your help

atush

You need to be in equities not cash. For some if not all. The 9 yr old only has around 9 years to go, but the 4 year old more than a decade.

For my 3, I saved monthly into an investment trust savings plan. I used Witan and F&C. I started with only 25 per month (some do 20).

These days, you can use a Jisa, but given the limits per year, that may not be enough for the 9 yr old, but might for the 4 yr old. So for the older one, you can use the cash you have already saved to star them off.

Also, when my first started, I kept saving for the twins who started later. And in his first year, we earned more so paid that from savings and income and did not use the fund.

And having savings in cash will help you not to have to sell investments should the start of university coincide with a market fall.

WE did not expect to be able to pay from income, as we had only 25 a month to save when we first started. But compounding of investment returns is your friend.

bigfreddiel

Problem with a jisa is that at 18 it becomes your child's to do what he likes with it, so he may just blow it all on wine, women, and fags and then just squander the rest!

Cheers fj

atush

Sure, if he knows about it. But if you dont tell him/her there is such an acct?

And of course, you have their whole childhood to both raise them properly and to have educated them about finance.

jimjames

As above I agree that investments not savings are the best way to try to achieve sufficient growth to pay fees.


Have a look on www.hl.co.uk, they might not be the cheapest but very good website.