Savings pots for grandchildren

DaveJ454

I wish to invest for my three grandchildren via stocks and shares which I will manage, for birthdays etc. I am aware that for JISAs they must be opened by parents, buts thats a chore for them. I could invest it In my own ISA with Hargreaves Lansdown but I would have a different investment strategy for their investment and over the years it would be difficult to separate mine and theirs. Outside an ISA I would pay tax.
A number of new banks are offering different pots for their current account customers, I wondered if any platforms (HL don’t) offer such a thing.?  Any suggestions on this topic welcome

Malthusian

Bare trust accounts for the grandchildren. As the money is coming from their grandfather, they will pay tax at their own rates and allowances on income and gains, which unless they are absolutely loaded already will mean zero income tax and CGT (if properly managed).

They would be absolutely entitled to the money at 18 (or 16 in Scotland) (largely the same as a JISA apart from the Scottish bit and you remaining in control of the investments).

HL offer them.

xylophone

I am aware that for JISAs they must be opened by parents, buts thats a chore for them.

Do you mean that it is too much trouble for the parents?

It would be quite straightforward for them to set up a JISA for each child with the chosen provider - you could then  offer to choose the investments and make a regular contribution to each account?

https://moneytothemasses.com/quick-savings/parents/best-junior-stocks-and-shares-isa

The Vanguard offering might be worth a look.

https://www.vanguardinvestor.co.uk/investing-explained/stocks-shares-junior-isa

Malthusian

xylophone said:

It would be quite straightforward for them to set up a JISA for each child with the chosen provider - you could then  offer to choose the investments and make a regular contribution to each account?

At the risk of being pedantic, JISAs have to be run by the responsible parent until the child is 16 (i.e. not the grandparent). The OP could choose the investments in the sense of telling the parents what to invest in, but the parents would have both the control and the legwork.

With a bare trust account by contrast the OP retains control and can do the legwork himself.

The main benefit of a JISA (if you are not already loaded with unwrapped bare trust funds) is the automatic conversion to an adult ISA at 18, but you still need to be a very well-off teenager to have any tax problem for a JISA to solve.

xylophone

JISAs have to be run by the responsible parent until the child is 16 (i.e. not the grandparent). The OP could choose the investments in the sense of telling the parents what to invest in, but the parents would have both the control and the legwork.

I am aware that the JISA must be controlled by the responsible parent - I was merely suggesting that setting up the accounts ( and pressing a button or two to buy/sell) doesn't count as the thirteenth labour of Hercules! !   The OP could offer to advise on the choice of investments and (once given the account details) make his regular contributions.

DiggerUK

DaveJ454,  an alternative would be to put by a Gold Sovereign each year. Then you can hand them over when you think it appropriate.
At the moment they are about £325 -£330 each, if that is a bit rich for you then go with Half Sovereigns. There are no taxes involved buying or selling because they are UK legal tender..._

Notepad_Phil

Do you know whether three will be the limit or could there be more, in which case will you be able to put the same amounts away for each of any subsequent grandkids?

We'll be putting money away for our grandkids but for us we'll be investing the money into my own and OH's S&S ISA's so that we have control of when the money is passed over. We'll keep them separate from our own money by using specific funds for them. We'll then put the details into our wills and keep them updated so that the money will get passed over should anything happen to us.

We'll hopefully keep the contributions going and increase them as more grandchildren come along, but we'll know that whatever we've invested will be shared evenly amongst them all when it's time to pass the money on.

DiamondLil

I have an ISA with Charles Stanley as well as six other, designated accounts, one for each of my six grandchildren. Doing it this way works very well and any tax due hasn't been enough to worry about so far.