Savings for 16 year olds

madcow1972

Hi,


Hoping someone can help me. I feel like I'm going round in circles! My three children were left an inheritance each (around 10K pp) that I'm trying to re-invest. I've found a suitable investment for my younger two who are under 14. But I'm struggling to find anything for my 16 year old son. All kids investments seem to go up to 16. The adult ones start at 18!! Are there any accounts with a decent interest rate (hoping for around 3%) for those in between?

unimaginative_user_name

It depends a lot on circumstances. When will your sixteen year old need to access these funds. Are you seeing this as a long term investment (ie 5-10 years or even longer) or are you thinking this might help see him through university?

The Halifax have a 4% Junior ISA which would account for just over £4000 of the money. The rest could be put in another savings account and another £4000 transferred in in April. He would have access to the money at 18 and if he's sensible this would be a good back up for university.

Another option would be to wait and see for the Help to Buy ISAs that are due to come on the market in the autumn. Adult ISAs are available to 16 year olds (IIRC) and while cash ISAs on the whole pay very poor interest the help to buy ones will be topped up by the government by 25% at the point when your son gets his first mortgage.

If you see this as long term then a stocks and shares ISA might be worth exploring or even starting him off on a pension. You can contribute up to £2880 a year into a SIPP for example and the government will add an extra £720 to it in tax relief.

xylophone

The Halifax JISA will take £4080 - the balance might be put into a Nationwide Smart Limited Access - next tax year the ISA can be topped up, and possibly the year after that.

http://www.nationwide.co.uk/products/savings/smart-limited-access/features-and-benefits

https://www.gov.uk/junior-individual-savings-accounts/overview

sparkiemalarkie

Skiptons for easy access 2.25%


http://www.skipton.co.uk/savings/childrens/leap-account