First Time Parent - Savings Account advice

sliceofham

Hi everyone, 

Hope you are well.

I've recently been lucky enough to welcome my first child into the world, however he was a few weeks early and has rocked the boat on my plans of getting some things in place prior to his arrival! 

I was just wondering if anyone had any advice in terms of a savings account / ISA that I could get in place (or anything else suitable) to start putting money away for him to receive when he is older. Again, very new to all of this so will take on board any advice that people can pass on or if you need any further information from myself please do ask.

My parents took out a policy which matured on my 18th birthday so I was thinking of doing something similar... Probably look to put away £50-£100 a month.

Thanks for any help! 

Emmia

What about a junior ISA?

sliceofham

Emmia said:

What about a junior ISA?

Yeah I know these seem to be quite popular. I guess its trying to understand what is the best one to go for etc. Also, would I be correct in saying that the ISA passes over to the child irrespective of what happens? Or does the parent retain some level of control over it?

Emmia

sliceofham said:

Emmia said:

What about a junior ISA?

Yeah I know these seem to be quite popular. I guess its trying to understand what is the best one to go for etc. Also, would I be correct in saying that the ISA passes over to the child irrespective of what happens? Or does the parent retain some level of control over it?

Once your child is an adult it becomes their money - hopefully you'll raise them with enough sense not to spaff it on partying in Ibiza or whatever. 

thegreenone

Congratulations on the birth of your son.  I hope Mum, Dad and Baby are doing well.

 As you will discover, babies can be very expensive so I am going to suggest that you cut down the amount you put into the account.  Ahem... if you are thinking of having more children, finding £100 per month per child may become a stretch.  I don't know what you do for a living but just bear in mind that if you need to pay nursery fees - they are whopping.

Perhaps start at £25 pm and for subsequent children and then build up.  Or, if you are eligible for Child Benefit, put that away each month and top up a little. Also, see if relatives would add money for birthdays and Christmas rather than a mound of plastic toys. 

sliceofham

thegreenone said:

Congratulations on the birth of your son.  I hope Mum, Dad and Baby are doing well.

 As you will discover, babies can be very expensive so I am going to suggest that you cut down the amount you put into the account.  Ahem... if you are thinking of having more children, finding £100 per month per child may become a stretch.  I don't know what you do for a living but just bear in mind that if you need to pay nursery fees - they are whopping.

Perhaps start at £25 pm and for subsequent children and then build up.  Or, if you are eligible for Child Benefit, put that away each month and top up a little. Also, see if relatives would add money for birthdays and Christmas rather than a mound of plastic toys. 

Thanks very much! Everyone is doing great.

Yes I was thinking about maybe starting at that amount for the first few months whilst its possible to save in that region then can adjust as things get a bit more expensive haha!

I don't think any more children are on the cards, we are happy with our little guy. Never say never, but we are definitely not planning on any more any time soon.

Good idea with the relatives as well. Will make sure that is suggested across both our families and friends.

sheramber

My grandson has a junior ISA and  a savings account used  by parents for anything he needs. 

Exodi

This question comes up regularly on this forum.

Usually you'll have a suggestion of a Junior SIPP (it's probably the best financially, but it's a bit boring and they can't access the money when they might need it most, e.g. first car/house/etc), a JISA or childrens savings accounts.

Some (like myself) are a bit more pessimistic on giving an 18 year old unrestricted access to a large sum of money, fearing they will put it up the wall on takeaways, nights out and designer clothing in short order. Unfortunately I have seen it happen first hand in my wider family. Of course we can hope our kids will know better.

Personally I will be investing the money in my own S&S ISA, earmarking some for them, and then making gifts as and when needed (e.g. suprising them by buying their first car).

Young adults aren't renowned for their financial prowess, but others raise a fair point that if they do spaff it up the wall, it teaches them a lesson in the value of money (but I guess it depends on the sum, a couple of hundred might be worth teaching a lesson for, less so for £20k that you scrimped and saved for over the past 18 years).

There is no single right answer.

Rob5342

We opened a junior ISA when our son was born, he is nearly 18 now and has just over £25,000 in it. We took the view that we'd give him something to get started with and he'd either benefit from or have to live with the choices he made. It seemed unfair to deny him access when he might be quite sensible with but if he wasn't then tough, he'd have to earn the money for whatever he wanted.