What banks / building societies offer will trust SAVINGS accounts?

wmb194

Yellowman said:

The will (probate completed) states that a sum of £20,000 is to be provided to a child (currently aged 2) at the age of 18 - so this becomes a bare trust.

One financial advisor suggested that placing this sum in a bond may be too risky (as one product) and that an investment trust would be less so (as this would include a range of products).

I suppose a range of bonds may be an option, but finding bonds for will trusts is proving difficult.

Depends on the bond and the investment trust.  Putting it all in a single gilt issue wouldn't be considered risky and it depends on the investment trust e.g., I wouldn't consider one that invests solely in Russian equities to be less risky.

Frogletina

Frogletina said:

I've just opened a trust account for my 15 year old granddaughter with Skipton building society.

It pays 1.3% interest

Yellowman said:

I think this is different from a will trust.

I opened it as a bare trust as an executor 

Frogletina

Daliah said:

If all that is required that the child gets £20,000 (at least) when they are 18, then surely a cash JISA fits the bill? Get a parent / legal guardian to open the JISA in the child's name, put £20k into it now, and the child can get the money when they are 18. In the interim, the money is the child's, and nobody can withdraw it.

Only £9000 can be put in a JISA in one tax year

Yellowman

Some very useful suggestions - many thanks all.

I shall investigate the aforementioned Skipton Building Society trust account.

Regarding a Junior ISA, as one of two executors / trustees (neither of us parents of the beneficiary), would we be 'allowed' to register one of the parents as the registered JISA contact? Payments could then be made in stages.

xylophone

Regarding a Junior ISA, as one of two executors / trustees (neither of us parents of the beneficiary), would we be 'allowed' to register one of the parents as the registered JISA contact? Payments could then be made in stages.

Assuming that the will states that this is an absolute gift to the child (to be held on her behalf until (NOT "IF") she reaches age 18, then the bequest has "indefeasibly vested" in her.

That is to say, she is already the beneficial owner of the money and it (plus any income arising) belongs to her absolutely.

The money is to be controlled by a Bare Trustee until she reaches age 18.

You have already discovered that the interest rate available for a  standard child account( let alone any savings bond which could be held in bare trust) is well below what is available on a JISA.

It seems to me (no expert) therefore that although it is true that the child may (if desired) control a JISA from age 16 (but not access it), it would be a decision in the best interests of the child for the Trustee to release the money to a JISA in the current and subsequent tax years.

https://www.thisismoney.co.uk/money/saving/article-1583863/Best-savings-rates-Junior-Isas-children-s-accounts.html

Only a parent or guardian may open the JISA but the Trustee may make a direct payment to it once he has the sort code and account number.

The Trustee might check with the parent each year that the JISA is receiving the best possible interest rate ( transferring the JISA as required to ensure this).

https://www.gov.uk/junior-individual-savings-accounts

Yellowman

It seems that JISAs are not recommended for a will trust fund as the trustee(s) would no longer have control of the fund.

The aforementioned 'Children's Saver' offered by Skipton Building Society seems like a good option (at least short-term) as it allows lump sums of £1 - £50,000 to be held in trust for a child (the child as account holder and the trustee(s) as account operator):
https://www.skipton.co.uk/savings/childrens/childrens-saver

I would like to consider the security of gilts. Can anyone recommend institutions that cater for trust funds?

wmb194

Yellowman said:

It seems that JISAs are not recommended for a will trust fund as the trustee(s) would no longer have control of the fund.

The aforementioned 'Children's Saver' offered by Skipton Building Society seems like a good option (at least short-term) as it allows lump sums of £1 - £50,000 to be held in trust for a child (the child as account holder and the trustee(s) as account operator):
https://www.skipton.co.uk/savings/childrens/childrens-saver

I would like to consider the security of gilts. Can anyone recommend institutions that cater for trust funds?

You can buy gilts via a stockbroker. One I know of that offers children's bare trust accounts is AJ Bell. Its information pages are a bit scant but if you take a look at the application form (click on 'open an account') it allows it to have two trustees so it could suit. However, it states that the first named trustee will have control of the account.

https://www.youinvest.co.uk/investing-for-children/dealing-accounts-for-children

xylophone

See https://www.hl.co.uk/shares/corporate-bonds-gilts/bond-prices/uk-gilts and look at the price you would be paying for the gilts.

For example, look at the price of Treasury 4 1/4 2036.

There would also be a charge levied by the broker for dealing in the gilt - example

https://www.hl.co.uk/shares/corporate-bonds-gilts

Yellowman

Many thanks for this information and the link to A J Bell.