How much to save for a child?

Anonymous101 · 23 March 2017 at 3:04PM

edinburgher wrote: »

'Presumably' because Another Joe referred to his child/ren possibly accessing the money earlier than typical pension age (i.e. 18/21, as opposed to 55+).

While a pension would definitely be a big help for children, I'd rather give them a leg up earlier on in their lives when their earning power will likely be at its lowest. A pension is too inflexible for this.

I agree they possibility need it most much earlier. Pension saving is an important lesson though and I was thinking that the additional 18-25 years of compound interest on the initial savings would be very nice to have! :money:

RedfordML · 23 March 2017 at 3:46PM

I have 3 children and @ 18 - if they were like me it would go on beers, clothes and holidays so I have aim to give them; £1800 when they each turn 18 and £2100 when they turn 21 (though this may change to £2500 @ 25) just ensure the money actually helps them a bit

BearWhite · 23 March 2017 at 3:56PM

I've got two sets of accounts for each of my kids. The first is where birthday money, gifts, etc goes. They can do what they like with this and I'll get them engaged with it as they get older. Hopefully this will teach them about money, and there's not that much in these accounts so if they spend the lot on holidays I'm not that fussed.

The second is investments for later life when they need a decent chunk of cash, I'm aiming to have somewhere north of £20k in here by the time each of them are 21. When they get to that age the wife and I will decide what they can spend it on. It's in my name so there's no danger of them accessing it!

jadex · 23 March 2017 at 4:48PM

BearWhite wrote: »

I'm aiming to have somewhere north of £20k in here by the time each of them are 21.
(...)
It's in my name so there's no danger of them accessing it!

aren't there tax/law implications for gifting £20k as a lump sum?

edinburgher · 23 March 2017 at 5:05PM

jadex wrote: »

aren't there tax/law implications for gifting £20k as a lump sum?

A straightforward cash gift from a parent to a child should be fine unless the parent dies within 7 years and it affects IHT in some way.

AnotherJoe · 23 March 2017 at 7:47PM

jadex wrote: »

aren't there tax/law implications for gifting £20k as a lump sum?

Not really, not in most cases and certainly not because its £20k.

MallyGirl · 12 April 2018 at 12:54PM

Apodemus wrote: »

My view is that complete openness on finances is much better.

I have gone for some openness but not full disclosure. DD knows that she has a secret account because she opened a letter addressed to her once. She has no idea how much is in it. There are actually several accounts - will be over £20k at 18.
She also knows that my mother gave DD's cousin some money at 18 and the 3 cousins get treated fairly so she will get something at the same age. She doesn't know how much he got but she does know that he blew it on a car but no insurance plus a load of drugs. She also knows he is now banned from driving and lost a decent job as a result - she is a very different type of person and will not be going down the same path.
She wants to be a vet (5 or 6 year uni course) so the money will help with running a car (needed for the vet placements) and seeing her through the holidays when she can't get a job because of the compulsory placements.
I got a sum of money at 18 which I knew nothing about - my granny had put a bit away when I was young and high interest rates had done the rest. I got contacts which improved my confidence a lot and later got an old V Dub which helped get me to silly o'clock rowing training and an out of town hotel job while at uni.

Alexland · 12 April 2018 at 1:47PM

MallyGirl wrote: »

DD knows that she has a secret account because she opened a letter addressed to her once.

With my tiny son I find a good leg chain with a short radius stops him getting to his letters when he is briefly allowed outside the cage. We also ensure all his clothes and toys have other people's name tags just incase he starts thinking he owns assets. Seriously though he can't count beyond number 2 yet but we keep trying... yesterday he learnt the word "bother" as I was having a bad day.

Alex.

MallyGirl · 12 April 2018 at 2:05PM

Alexland wrote: »

Seriously though he can't count beyond number 2 yet but we keep trying... yesterday he learnt the word "bother" as I was having a bad day.

Alex.

That could have been so much worse!
Back in the day when she was a toddler my DD was having a mumble about something and I asked she what she was trying to say.
Her response "T****y whinging"!
Her name starts with a K but she couldn't pronounce the K sound for some time so substituted with a T. I must have given her grief about whinging a lot for her to have learnt that word before she could say her own name

Zorillo · 12 April 2018 at 8:16PM

I'm aiming for £25k. £10kish in a JISA for them to have at 18 but hopefully not to waste, and the rest in a designated account in mine and my wife's name for us to look after until they're ready. Ideally I'd like it to be a house deposit.

They'll always have a small disposable pot in a normal bank account to play/learn/spend with, but the long term savings will not be directly accessible until they're grown up. They turn 1 next week so it's got a while to grow.

How much to save for a child?

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