ISA Withdrawal

Aussie82

Hi there,

I had recently opened up a Childs ISA for my daughter.  The rate was at 3.65%. 

However, I have now seen the Halifax Kids Monthly Saver Account for 5.5%, which I obviously would prefer to invest in.

The building society I had used for the Childs ISA says I can not withdraw the money until my daughter turns 18. 

Is there a way out of this arrangement and to be able to get this money out?  I have just missed out on the cooling off period to opt out unfortunately.     

Many thanks in advance

CooperSF

Aussie82 said:

Hi there,

I had recently opened up a Childs ISA for my daughter.  The rate was at 3.65%. 

However, I have now seen the Halifax Kids Monthly Saver Account for 5.5%, which I obviously would prefer to invest in.

The building society I had used for the Childs ISA says I can not withdraw the money until my daughter turns 18. 

Is there a way out of this arrangement and to be able to get this money out?  I have just missed out on the cooling off period to opt out unfortunately.     

Many thanks in advance

When did you open the ISA?

Aussie82

I had opened the ISA in April.  And it is in my daughers name as well (I should have said that before)..

Aussie82

Aussie82 said:

I had opened the ISA in April.  And it is in my daughers name as well (I should have said that before)..

@CooperSF

masonic

The building society is correct. The only way a Junior ISA is accessible outside of a cooling-off period is when the child turns 18, or is terminally ill / dies. It should be considered more like a pension than a savings account.

refluxer

There's nothing to stop you opening the monthly saver and paying into that instead from now on. As you can only pay £100/month into it, it wouldn't be suitable for any larger lump sum that you've got in the Junior ISA anyway.

Aussie82

Thank you very much for the info @refluxer and @masonic.  Very much appreciated!

refluxer

Just bear in mind that, while the 5.5% Halifax rate is obviously a good one and a great way of saving for a child on a regular basis, the fact that you can only pay in £100/month means that it'll only generate £33 in interest over the year.

If you had other savings accounts for them, then any interest earned over £100 from money you give your child will be subject to tax at your own rate. If tax is likely to be an issue (either now or in the future as their savings grow) then the Junior ISA obviously gets round this problem, being tax-free. Obviously the downside to a JISA is that the money is inaccessible until they are 18 (as you've already discovered), whereas a normal childrens' savings accounts will often allow some kind of access (for the child's benefit) if you thought they may need the money before then. This is the reason why many parents will have both a JISA and normal savings account(s) for their kids and split the money between them, as appropriate.

Which building society is the Junior Cash ISA with and what is the rate ? You can get up to 4.30% in a JISA at the moment (or 5.10% if you live in Bath) although just bear in mind that the building societies offering the best rates usually only allow management of a JISA account via branch, post or phone. You can transfer a JISA at any time in order to get the best rate.

Aussie82

Thanks very much @refluxer, your advice is greatly recieved.  The JISA is currently with Newbury Building Society.

Why is there a rate of 5.10% if you live in Bath then?

eskbanker

Aussie82 said:

Why is there a rate of 5.10% if you live in Bath then?

https://www.bathbuildingsociety.co.uk/personal-savings/accounts/childrens-accounts/junior-cash-isa/ has a 5.1% account but....

Applicants must either be able to evidence that they live, work or study in Bath, or be the child or grandchild of an existing Bath Building Society customer who has held a mortgage or savings account with Bath Building Society for at least the last 12 months.

born_again

Can you not transfer a junior isa between providers like a normal one?