Child Trust Fund (of c£15k) matures 2022. Is lifestyling a good idea?

all_greek_to_me

Our son's Child Trust Fund is currently worth approximately £15k. It's the investment type, with HSBC, and I understand that these are no longer lifestyled as they approach maturity. We're very cautious/inexperienced investors and I was always reassured by lifestyling. How useful/necessary is it? Should I consider switching providers?

Thanks.

xylophone

If your son is likely to require access at 18, then it might be worth considering a transfer to the best available cash JISA a year or two before his eighteenth birthday?

all_greek_to_me

xylophone wrote: »

If your son is likely to require access at 18, then it might be worth considering a transfer to the best available cash JISA a year or two before his eighteenth birthday?

Thanks. He'll probably continue saving at 18.

xylophone

Are you content with the HSBC CTF?

Had you considered a transfer to JISA? See post 3

https://forums.moneysavingexpert.com/discussion/comment/76299567#Comment_76299567

It is also worth knowing that as the CTF is based on birthday to birthday while JISA is based on tax year, it is possible to double up on allowance by making the full contribution to the CTF in the CTF year, transferring to JISA and making the full contribution in the JISA year.

https://www.choose.co.uk/guide/transfer-child-trust-fund-to-junior-isa.html

AnotherJoe

It depends what the plan for it is. Use for uni? Training? Keep it for the next 5-10 years?

johnadams7

Is that what you want, or what he says his plan is.
I recommend he gets his license passed asap, as insurance is cheaper the longer he holds it.

Also he may need a car to get to uni, to placements if he does say a medical course, or if he goes down the vocational pathway.

There is no very cautious investing, there is always a risk attached. For that reason I'd probably suggest transferring some to a junior isa.

all_greek_to_me

xylophone wrote: »

Are you content with the HSBC CTF?

Had you considered a transfer to JISA? See post 3

https://forums.moneysavingexpert.com/discussion/comment/76299567#Comment_76299567

It is also worth knowing that as the CTF is based on birthday to birthday while JISA is based on tax year, it is possible to double up on allowance by making the full contribution to the CTF in the CTF year, transferring to JISA and making the full contribution in the JISA year.

https://www.choose.co.uk/guide/transfer-child-trust-fund-to-junior-isa.html

Thanks. Just investigating this now.

all_greek_to_me

AnotherJoe wrote: »

It depends what the plan for it is. Use for uni? Training? Keep it for the next 5-10 years?

Current plan (his and ours) is to continue saving for property deposit (at least ten years from now) or career investment (post-uni).

all_greek_to_me

johnadams7 wrote: »

Is that what you want, or what he says his plan is.
I recommend he gets his license passed asap, as insurance is cheaper the longer he holds it.

Also he may need a car to get to uni, to placements if he does say a medical course, or if he goes down the vocational pathway.

There is no very cautious investing, there is always a risk attached. For that reason I'd probably suggest transferring some to a junior isa.

Thanks. We plan to pay for driving lessons and a (modest) car and to fund him at uni (+ student loans). His current plan is to save for the longer term, for a property deposit or career investment.

xylophone

Once he is 18, (and if the product is still around), he might wish to consider the LISA.

Alexland

Best buy table Cash Junior ISA rates are currently very attractive at 3.6% and it seems the HSBC CTF has charges of at least 1.15%. Given reduced expectations for future S&S growth (especially on suitable asset allocations as you approach withdrawal) then it might be time to switch out of investments into cash?

Someone else was recently in a similar position in the below thread.
https://forums.moneysavingexpert.com/discussion/6050416/should-i-transfer-ctf-to-an-isa

Alex