Child savings.

LunaFarley20

I’m confused about what type of account to open for my 1 year old? Think I would prefer a junior  ISA rather that stocks and shares ISA, don’t fancy the risk, am I being to cautious with that? And tips on deciding would be appreciated. TIA

Nurse2047

This is useful, well was for me anyway. 

https://youtu.be/isq_2tw6pdQ

As your child is only 1 you have time to ride any lows in the market so would recommend s&s isa as would be eroded by inflation if held in cash. 

kuratowski

Junior ISAs come in both flavours: cash or stocks & shares.

I would say that you are indeed being too cautious in avoiding stocks & shares, given the time horizon you are looking at.  As your child is currently 1 year old, and Junior ISAs cannot be accessed until age 18, this means you are saving for a minimum time period of 16-17 years, possibly longer, depending on what your child later decides to do with it.

Over such a long time period (i.e. more than 10 years) a cash JISA will lose some of its value due to inflation.  Whereas over the same time period, historically speaking, stocks & shares have nearly always increased in value over and above inflation.  Historically speaking the chances of losing some of the value over these timescales is very low indeed.

You could look at a Fidelity Junior ISA (which has no platform fees) invested in a single multi-asset fund, to keep things simple.  These kinds of funds come in different "risk levels".  I would suggest picking one with at least 60% equities.  Indeed, for a 1 year old child, 80% or 100% equities would not be unreasonable, if you are prepared to ride out the ups and downs.

Flobberchops

As above. Funds in a JISA are locked away until 18 anyway, so you can choose the certainty of pretty bad cash rates, or what must be a 95%+ chance to beat that rate in a stocks and shares JISA. Option C is: do both! Children can have a cash JISA and a sharedealing JISA with the £9000 annual limit split across the two.

strawb_shortcake

My Son was born not long after CTF were released, I was incredibly cautious and worried about risk and losing his money. I plumped for a cash CTF.
I'm only sorry I didn't have the forethought and gumption to consider it more and make a different decision, with hindsight I'd have picked s&s. At least today there are far more options for researching and making an informed decision