Saving for childrens education

mister_t

I am planning to save ~£75 per month towards our child's potential university education (if that is where they end up). I have looked into regular monthly saver accounts but feel that some kind of stocks/shares investment would give a better return over 18 years, and the long term should allow it to weather storms in the markets along the way.

I am not interested in the CTF as that gives full control of the money to the child when they hit 18. I just invested the government voucher plus a bit extra in a non-stakeholder S&S fund and will not put any more in. In 18 years time children everywhere will know that there is a pot of cash with their name on it.

Do I need to invest in my name to keep full control or is there some way of investing in the childs name but in trust such that I retain some form of control when they hit 18? My understanding of trusts is a bit limited. The money will ultimately be used for university education or house deposits but I don't want them to be able to just fritter it all away.

If it needs to be in my name, what is the best way of investing ~75 a month? Would it be in a S&S ISA, though I guess this would use up my ISA allocation?

Do funds include life-styling or would I need to do that manually when they approach 18?

Aegis

You could use your S&S ISA allowance for this. Since you'd only be investing £900 p/a You'd still be able to use the remainder each year for yourself (£6100, max £3k cash this year) to give a nice tax-free amount for yourself too.

I'm not sure what the rules are for investing in collective funds on behalf of kids, but that might also be worth looking in to, as his/her tax status is likely to be as favourable without the ISA wrapper as your is with it.