What is best to do with newborn babies £250 of gifts please?
bootcutboy
Posts: 175
Forumite
Hi all, we were given a few gifts of cash totalling £250 for our daughters birth 3 weeks ago.
I am hoping there is an easy answer to this question but We are just wondering if it is worth looking into whether to just open an account for her, or a savings account or an isa with the money? We don’t have a lot of money ourselves so we won’t be adding a lot to the £250 for the foreseeable future but we just want to do what’s best with her first little bit of money.
Any advice would be awesome thanks.
I am hoping there is an easy answer to this question but We are just wondering if it is worth looking into whether to just open an account for her, or a savings account or an isa with the money? We don’t have a lot of money ourselves so we won’t be adding a lot to the £250 for the foreseeable future but we just want to do what’s best with her first little bit of money.
Any advice would be awesome thanks.
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Comments
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Opening a junior ISA is worth considering, especially if you invest rather than save, in order to benefit from better long-term growth potential - the money is locked away until the child is 18....0
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Possibly premium bonds?
You never know, she just might be a very lucky, rich girl!Space available for rent0 -
Peelerfart wrote: »Possibly premium bonds?
You never know, she just might be a very lucky, rich girl!
I was give £3 in premium bonds when I was a baby, honestly not sure if they have ever won anything - have added £25K to them now and get quite a few wins each year .... and you never know0 -
Peelerfart wrote: »Possibly premium bonds?
You never know, she just might be a very lucky, rich girl!
The range of outcomes is extreme.
A less volatile result, with a better expected return, would come from buying and holding a cheap global stock-market tracker in a Junior ISA.
The money might not be needed for twenty-five years, so saving, rather than investing the money is probably irresponsible.Thus the old Gentleman ended his Harangue. The People heard it, and approved the Doctrine, and immediately practised the Contrary, just as if it had been a common Sermon; for the Vendue opened ...THE WAY TO WEALTH, Benjamin Franklin, 1758 AD0 -
I would stick it in a simple to administer S&S Junior ISA which locks it away until they are 18.
My son is with Orbis who have a special offer where they charge no management fees for money invested during the first 12 months until the child is 18. They hope you will add more in later years.
https://www.orbis.com/uk/individual/isas/junior-stocks-shares-isa
They only have 2 funds to choose from the more volatile and more likely higher long term return Global Equity or more stable Balanced fund. Either way the money will go up and down over the years and should beat cash savings.
Alex0 -
Bootcutboy , congratulations on the birth!
One aspect that you need to consider is whether you are serious about keeping track of this and perhaps adding more money as time goes on. It is probably very common for babies to get money gifts that are set-aside and forgotten about. A chance conversation thirty years later might make you remember about them. If the money was used to buy Premium Bonds, the child (by then adult) can simply contact NS&I, giving the relevant addresses they have lived at and asking if they ever had Premium Bonds. If you were to remember a Junior ISA thirty years later, would you remember the name of the provider? Would they be willing to speculatively look up a range of addresses for the details?
S&S Junior ISA is probably the best as an investment, no doubt about that, but in my experience, child gifts are often a one-off that languishes for years and sometimes never tracked down.0 -
The Coventry offer a cash JISA at 3.6%.
https://www.coventrybuildingsociety.co.uk/consumer/product/savings/children/junior-cash-isa.html0
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