What banks / building societies offer will trust SAVINGS accounts?

Yellowman

As a will executor / trustee of a sum for a minor child to be paid at the age of 18, I am thinking about using Barclays Bank for the trust account.

However, this is a current account with a peppercorn rate of interest, and so the value of the sum will be eroded by inflation.

Are there any banks / building societies offering higher interest savings accounts as a trust account?

Keep_pedalling

Basically no, there are few available and none pay more than peanuts. Depending on the age of the child and the size of the inheritance their could be alternative options. 

Daliah

How many years before the child is 18? If 7-10 or more, investments are a better choice than savings. A JISA takes up to £9K per annum, and a tracker fund in a JISA could be a good choice. Depending on the total sum of money, engaging an IFA might be a good idea.

Yellowman

Thank you for your inputs.

The sum is £20,000 and the child is currently two years old. The trust account must be risk-ree.

I am surprised there are so few trust accounts available as there must be many people wanting a secure trust funds. Where are they going?

Even Barclays Bank seemed unsure of their own product and had to search at length for the relevant information!

Daliah

There are a huge number of companies that offer trust accounts. https://moneyfacts.co.uk/savings-accounts/guides/what-kind-of-account-is-a-trust-account/

Huge shame that you cannot go for an S&S JISA. 

Yellowman

I have seen this list but I am unsure how accurate or updated it is, as the author heads it as 'savings accounts'.

When contacted, HSBC had not even heard of a trust account.

The Barclays and Cater Allen accounts are current accounts only.

Can a Junior ISA be used as a trust account?

Daliah

Yellowman said:

Can a Junior ISA be used as a trust account?

An ISA can only be held by an individual, not some other legal entity. A trust is an other legal entity.

wmb194

What type of 'trust' does it need to be? Ordinary children's savings accounts are normally 'bare trusts' and compared to other types are very straightforward.

Yellowman

The trustee in this case is not a parent - I think normal children's savings accounts have to be registered to a parent or guardian.

wmb194

Yellowman said:

The trustee in this case is not a parent - I think normal children's savings accounts have to be registered to a parent or guardian.

Nope. Although some banks and BSs might make this restriction - IIRC, notably Nationwide - this is otherwise incorrect. For instance, take a look at Barclays, Halifax and Lloyds' children's accounts' T&Cs.

stavros_2

Daliah said:

An ISA can only be held by an individual, not some other legal entity. A trust is an other legal entity.

A trust is not a legal entity but a legal relationship