Grandparent wanting to save for grandchildren

BarbaraH

Hi. I have been saving for my two grandchildren (aged 4 and 7) since their respective births. They're in Halifax Kids' Savers accounts.  I understand a Junior ISA would be better value and that  would also be kept until they're 18, whereas the savings account will give them access at 16. However I can't rely on (one of) the parents to manage the money, so I don't want them to be able to access it either. Am I allowed to open a Junior ISA as a grandparent or does it have to be the parent, as the advice feels conflicting? Or is there something different I should do? Thanks for any help here!

PRAISETHESUN

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

My understanding is that the JISA can only be opened by the child's parent/guardian, but once open you can deposit money if you are provided with the account details. Any money you deposit will belong to the child. The parent has the right to manage the ISA (ie. change providers, change investments, etc) but cannot withdraw any money which has been deposited.

refluxer

As mentioned above, only a parent or legal guardian can open a Junior ISA on behalf of a child unfortunately although, once opened, you're free to pay into it just like a traditional child's savings account.

In terms of a Junior Cash ISA being better value than a child's cash savings account, it's all down to the interest rate at the end of the day (as money given to a child by a grandparent isn't subject to the same tax rules as money given to a child by a parent, for whom a Junior ISA can have advantages over a non-ISA savings account) and if and when you want the child (or potentially the parent) to have access to the money. If the parents aren't to be trusted, then continuing to save for your grandchildren yourself might be the better option. You should be able to find a child's account that pays more than a Halifax Children's Saver. You could even save for them in an adult account in your name if the rate is higher, although you'd obviously want to be mindful of whether tax would be an issue in that instance.

If you're talking about a Junior Stocks and Shares ISA earning more than a normal savings account, then that is certainly possible in the longer-term but you'd obviously need the parents to open one and manage it, which doesn't sound like the best option based on your comments.

Albermarle

Have you considered just saving the money in an account in your name? Then you can give it to them at a time of your choosing .

Alexland

BarbaraH said:

However I can't rely on (one of) the parents to manage the money, so I don't want them to be able to access it either. Am I allowed to open a Junior ISA as a grandparent or does it have to be the parent, as the advice feels conflicting?

Are you able to ask the other parent to open the JISA account?

Neither of them would be able to withdraw from it anyway.