Child trust fund and new Isa

jonnyb1978

Hi

Child is now 15 and had a govt child trust fund set up when he was born. We have never bothered to top up and has been left dormant. 

However I'd like to set up a stocks and shares Isa for him (Junior) linked to my own account at present. 

Am I right in saying he can't have both. Can I still set up the ISA and transfer over trust fund thus closing the trust fund. 

Any advice appreciated. Thanks. 

Alexland

Correct you would need to transfer the CTF into any new JISA however you will find the lowest cost S&S JISA providers (Fidelity who have no platform or trade charges until 18 if you stick to traditional OEIC funds, 0.35% ongoing after that) or Vanguard (0.15% ongoing with no trade fees on funds or batched ETF trades) do not accept CTF transfers so you might find it best to use a Cash JISA from a high street bank as a staging account before onward transferring to a S&S JISA provider.

Obviously if the child is expected to spend the money at 18 then that isn't long enough to have any confidence of a positive outcome from a S&S based investment so maybe now would be a good time to derisk to a preferential rate cash JISA from the MSE besy buy table but if they are likely to leave the money invested for longer under an adult S&S ISA until their mid 20s or later then happy days and wishing them good fortune with the new S&S investment.

jonnyb1978

Thanks

I have a lifestrategy stocks and shares isa with vanguard and was hoping to use them as the JISA also.

So basically set up a cash isa and once set up and money deposited, set up with Vanguard and transfer. 

It's obviously his to spend as he pleases once 18 but it should be a longer term investment. 

Thanks for the help

Alexland

Yes, Vanguard don't accept CTF transfers so you would need to bridge by first transferring into another Junior ISA provider preferably a modern bank (check first) as S&S providers tend to be slower and building societies tend to issue transfer cheques which I recall Vanguard also don't accept.

https://www.vanguardinvestor.co.uk/need-help/answer/can-i-transfer-a-child-trust-fund