I Want a child savings account that they cannot touch utill 25

vagasv1

I want an account for my 3 month old child that they cannot get at until they are 25 unless one of their guardians allows it.

The Trouble is, myself, both grand parent and one uncle plan to put £40 a month into a savings account for my child. £160 X 12 X16 = £30,720 that is without any interest. I don’t want a 16 or 18 year old teenager that amount of money. I know if I had it I would have no kidneys left. I want the money to go to university or a car or a house.

Is there such an account out there?

dunstonh

I want the money to go to university or a car or a house.

25 is a bit old for university.

Do you want to invest or save? 21-25 years of savings to me seems a waste of money. Investing seems more logical. However, tht is your choice to make.

vagasv1

dunstonh wrote: »

25 is a bit old for university.

They can take it out but b 4 they are 25 they need a parent to sign for it aswell

I just don't want a 18 year old boy to have access to 30k. He will be doen the pub every night like I would of been

Stargazer_Lily

vagasv1 wrote: »

I want an account for my 3 month old child that they cannot get at until they are 25 unless one of their guardians allows it.

The Trouble is, myself, both grand parent and one uncle plan to put £40 a month into a savings account for my child. £160 X 12 X16 = £30,720 that is without any interest. I don’t want a 16 or 18 year old teenager that amount of money. I know if I had it I would have no kidneys left. I want the money to go to university or a car or a house.

Is there such an account out there?

What about setting up three or four accounts to be released on 18th, 19th, 20th and 21st birthdays (or as you see fit). That way the money is theirs to do what the want with, is there for them at the times when they're most likely to need it, but staggered so that they can't spend it all in the pub?

Lil

PBA

Any kids savings accounts would need a trustee appointed to look after the account for a 3 month old. The account then doesn't automatically get handed over to the child at any point, but the trustee would have to request the account to be handed over into the child's name. So in theory the account still could be running until your child's 25th birthday with the trustees running it. The only problem would be that, once your child turns 16, the interest would have to be paid net of tax (ie with 20% tax taken off). Not the biggest problem in the world, but it would mean you'd have to manually request a tax refund each year, assuming your child wouldn't be a taxpayer anyway at 16.

Other possibility is that you arrange a regular savings investment in your name, putting the £xx a month into that, and then when the time is right cash it in and give the money to your child. This gives you the possibility of a better return, but the downside is the money has to be in your name as investments generally aren't available to under 18s.

The last option is the government Child Trust Fund, which doesn't sound like what you'd want as the money would automatically get transferred to your child on their 18th birthday. (Personally, I think giving a large sum of money to someone on the same day they legally become able to drink is a recipe for disaster...)

vagasv1

PBA wrote: »

(Personally, I think giving a large sum of money to someone on the same day they legally become able to drink is a recipe for disaster...)

Yes so do I hence my question

thanks very much that is helpful to me

Aegis

Surely getting an R85 form would allow the interest to be paid gross in a much more efficient and pain-free manner than having to go through the tedium of reclaiming the tax paid on net interest?

dunstonh

Using a regular contribution unit trust with the child name in the designation whilst noting the record of a gift each year could be one way of doing it.

You can have four named holders on the unit trust so each party can be involved.