Fund selection for JSIPP

MX5huggy

LV_426 said:

MX5huggy said:

LV_426 said:

MX5huggy said:

JSIPP is a bonkers product for all but the rich. (Used all your own ISA and SIPP allowances this year?).

Why do you say that? I'm far from rich, and no I've not used all my allowances.
Is there a better long term savings vehicle, with similar tax benefits?

Put it in your own SIPP then you can access it 30 to 40 years earlier give it to your daughter then she can put it in her own SIPP getting another bite of tax relief. Or ISA it so she can put it in an LISA and then buy a house, it’s just really inflexible to use a JSIPP.

Inflexible? You're talking about two different financial products here. Both have their place. I agree an ISA is more accessible, and she already has a JISA. I don't think it's a good idea to completely ignore a (J)SIPP, and the sooner you start contributions, the better. The govt kindly gives you an extra £720/year, which isn't the case with an ISA. I'll take the free money.

You get the same £720 if you use your own SIPP. 

cloud_dog

I would agree that a junior SIPP is the absolute lowest priority, but there are other reasons for considering getting one up and running before they hit 18.  IHT or deprivation of asset considerations, simply being aware that a pension exists and its details should you wish to help add to it (dependant on circumstances), ensuring you protect that age 55 access (yes, I am stretching things now).

LV_426

So I'm getting a general negative vibe for the JSIPP. Surprising considering this is the pensions and retirement section.

QrizB

LV_426 said:

So I'm getting a general negative vibe for the JSIPP. Surprising considering this is the pensions and retirement section.

I think the vibe is that you need to consider it in terms of your full financial situation.

I'm paying into a SIPP for my teenager but that's after maxing my own pension contributions and my wife's. Would a LISA have been a better choice? Maybe, but I'm prone to prevaricate and as a famous general once said "a good plan, violently executed now, is better than a perfect plan next week".

LV_426

QrizB said:

LV_426 said:

So I'm getting a general negative vibe for the JSIPP. Surprising considering this is the pensions and retirement section.

I think the vibe is that you need to consider it in terms of your full financial situation.

I'm paying into a SIPP for my teenager but that's after maxing my own pension contributions and my wife's. Would a LISA have been a better choice? Maybe, but I'm prone to prevaricate and as a famous general once said "a good plan, violently executed now, is better than a perfect plan next week".

Or indeed any plan, compared to no plan. Part of the problem is you talk to most kids and they have no interest in financial planning. Retirement is so far away that it's irrelevant to them.
And you know what, my only regret is that I didn't contribute more in the first years, because as we all know, that's when it counts most.

I'm still contemplating what to do for the best really. I probably won't be touching a lot of my DC assets, so the kids can certainly have those. I think the biggest single financial situation that's helped me in my life, is having a really low mortgage. That's mainly due to buying at probably the best time in a generation, and probably won't be repeated in my kid's lifetimes.

I have so many worries about my kids, whether they'll get a job that pays enough to make them financially secure. I got lucky finding a career that mostly interests me, and pays reasonably well. Unfortunately they don't share my interest in technology. But then, I probably worry far too much.

But my main issue is, how best can I use my surplus money to help them.

UrbanAchiever

LISA can only be opened from the age of 18, so no good for the OP.

dontleavemehigh

Briefly searched for Jsipp on the forum and landed here, although it's six months old.  Just for balance, here's my take as the father of a 6 month old.  I'm looking to put money into different pots for him eg premium bonds, jisa, discretionary trust and jsipp.  The weighting of each pot will depend on your own personal and financial circumstances and appetite to risk (do you want them accessing lump sums at 18 etc).  I will choose to fill the JSIPP first up to the value of £2880.  Why?  Because I get a Gov top-up of £720, that's a 20% return, 25%(ish) once you've included the return on the fund.  Assuming you're not Jeff Bezos, Warren Buffet, or a superstar investor, returns of 25% in real life just don't exist.  If I only had limited funds available then I would prioritise saving for a flat deposit which wouldn't be in a JSIPP pot.  So it's a very individual decision based on your own particular circumstances.