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Results: What is a reasonable sum to save for a child to give them when they turn 18?

Nothing - let the blighters fend for themselves!

13.75% • 11 votes

Nothing - but I do intend to support them with housing, purchases or ad hoc cash gifts

31.25% • 25 votes

0 - 10,000

20.00% • 16 votes

10,000 - 25,000

16.25% • 13 votes

25,000 - 50,000

11.25% • 9 votes

More than 50,000

7.50% • 6 votes

You may not vote on this poll

80 votes in total.

  • FIRST POST
    • Flobberchops
    • By Flobberchops 20th Mar 17, 3:18 PM
    • 804Posts
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    Flobberchops
    How much to save for a child?
    • #1
    • 20th Mar 17, 3:18 PM
    How much to save for a child? 20th Mar 17 at 3:18 PM
    Hi all,

    Basically I'm wondering what a realistic figure is to aim for when planning a child's savings pot, with a view to providing a lump sum when they turn 18.

    "How long is a piece of string" would be the trite answer, but I'm interested in gauging what other parents of MSE consider a suitable amount.
Page 2
    • redmel1621
    • By redmel1621 23rd Mar 17, 1:58 PM
    • 5,811 Posts
    • 25,449 Thanks
    redmel1621
    Three of my children got the government child trust funds when they were born, but the eldest didn't. I have since opened him a junior isa and have saved into it when I could afford it. It currently stands at around 900. I haven't been able to pay anything in for the last few years, but this will change from May. I have 18mths to get it up to the target I set myself of 2000. I want it to cover his driving lessons and tests. then anything left over can be put towards a cheap little banger, if he wants one right away. If he doesn't, then I will encourage him to open himself a cash isa and save it, with a view to adding a small amount monthly from wages, until he wants/needs a car.
    Unless someone like you cares a whole awful lot,
    Nothing is going to get better. It's not.

    • Anonymous101
    • By Anonymous101 23rd Mar 17, 2:04 PM
    • 1,148 Posts
    • 553 Thanks
    Anonymous101
    '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.
    Originally posted by edinburgher
    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!
    • RedfordML
    • By RedfordML 23rd Mar 17, 2:46 PM
    • 735 Posts
    • 389 Thanks
    RedfordML
    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
    • By BearWhite 23rd Mar 17, 2:56 PM
    • 570 Posts
    • 748 Thanks
    BearWhite
    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
    • By jadex 23rd Mar 17, 3:48 PM
    • 659 Posts
    • 281 Thanks
    jadex
    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!
    Originally posted by BearWhite
    aren't there tax/law implications for gifting 20k as a lump sum?
    • edinburgher
    • By edinburgher 23rd Mar 17, 4:05 PM
    • 11,202 Posts
    • 60,135 Thanks
    edinburgher
    aren't there tax/law implications for gifting 20k as a lump sum?
    Originally posted by jadex
    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
    • By AnotherJoe 23rd Mar 17, 6:47 PM
    • 10,589 Posts
    • 12,118 Thanks
    AnotherJoe
    aren't there tax/law implications for gifting 20k as a lump sum?
    Originally posted by jadex
    Not really, not in most cases and certainly not because its 20k.
    • MallyGirl
    • By MallyGirl 12th Apr 18, 12:54 PM
    • 2,954 Posts
    • 7,951 Thanks
    MallyGirl
    My view is that complete openness on finances is much better.
    Originally posted by Apodemus
    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
    • By Alexland 12th Apr 18, 1:47 PM
    • 3,110 Posts
    • 2,453 Thanks
    Alexland
    DD knows that she has a secret account because she opened a letter addressed to her once.
    Originally posted by MallyGirl
    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.
    Last edited by Alexland; 12-04-2018 at 8:30 PM.
    • MallyGirl
    • By MallyGirl 12th Apr 18, 2:05 PM
    • 2,954 Posts
    • 7,951 Thanks
    MallyGirl
    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.
    Originally posted by Alexland
    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
    • By Zorillo 12th Apr 18, 8:16 PM
    • 357 Posts
    • 217 Thanks
    Zorillo
    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.
    Last edited by Zorillo; 12-04-2018 at 8:22 PM.
    • OUNN
    • By OUNN 13th Apr 18, 8:24 AM
    • 42 Posts
    • 67 Thanks
    OUNN
    We're in a fortunate position that we were looking at roughly 100 a month for the little one.

    Initially I went with 100 a month into a JISA (it was the minimum funding), but my wife wasn't too keen on that kind of sum becoming little ones when they turn 18 - while we will be teaching her all we can about money and investing, you never know how they will be in their teenage years.

    So we've compromised. The JISA allows lump sums. So I'm now funding this by 600 a year, and also funding my own ISA in the same fund by 600 a year.
    It's still working out at the 100 a month, but we have some control over when or if the second pot becomes the little ones.

    On top of that, I'm in the process (a month and a half and counting) of setting up a stakeholder pension for the little one, to fund with 25 a month initially. With the top up, I view it as money back from the government for some of the tax I pay
    Last edited by OUNN; 13-04-2018 at 8:27 AM. Reason: ISA not USA
    • Schoolworker
    • By Schoolworker 13th Apr 18, 8:43 AM
    • 287 Posts
    • 610 Thanks
    Schoolworker
    You guys seem to be able to put lots away for your kids. I have 2 kids and both have a junior ISA account - daughter got money from government but son did not but we put in money equal to the government for them so it's only about 600+ in this account which they will get at 18.

    We have another child account for both and 25 was put in every month until the age of 5 I think and now it's 30 each month for each h child and I can decide when to give this money to our kids. It's a reasonable amount I think considering we go holidays and day trips etc without getting any child benefit. It will give them a bit of a start and hope they will spend ok.

    I got about 200 in a bank account from my parents but they did buy a new bed when I bought my first flat and made a big payment towards our wedding so still helped me out.
    • stoozie1
    • By stoozie1 13th Apr 18, 8:53 AM
    • 608 Posts
    • 566 Thanks
    stoozie1
    We mostly save towards what WE will be expected by the government to put towards their University expenses, 92k at last conservative reckoning.

    Once I know we are ok to fund that, I'll start putting aside something to help with a house deposit.
    Save 12 k in 2018 challenge member #79
    Target 2018: 24k Jan 2018- 560 April 2670
    • Alexland
    • By Alexland 13th Apr 18, 9:00 AM
    • 3,110 Posts
    • 2,453 Thanks
    Alexland
    We put so much away because with an uncertain future we want our son to have the opportunity to go to university, buy a property and have his own family. Sure that might not suit him but at least he will have the option.

    We stop short of giving him a pension as the tax saving is marginal (in my case I expect to have LTA issues anyway so am glad my parents didn't start me a pension) and it's good that he has something in life that he can claim as entirely his achievement.

    We mostly save towards what WE will be expected by the government to put towards their University expenses, 92k at last conservative reckoning.

    Once I know we are ok to fund that, I'll start putting aside something to help with a house deposit.
    Originally posted by stoozie1
    Ouch I was thinking 70k (30k tuition fees and 40k living expenses) is 92k an inflation adjusted number, 4 years or London accommodation? I expect our son would have a loan for some of it. I had to pay back a student loan and work the holidays.

    2 years old and we have invested around 9k for him so far. Plus whatever share of my LISA he gets towards a house deposit. The rest is going into my wife's pension until her LISA becomes available.

    Alex.
    Last edited by Alexland; 13-04-2018 at 10:49 AM. Reason: Added reply to Stoozie
    • stoozie1
    • By stoozie1 13th Apr 18, 12:20 PM
    • 608 Posts
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    stoozie1
    I've got 4 sons, so that's all of them
    Save 12 k in 2018 challenge member #79
    Target 2018: 24k Jan 2018- 560 April 2670
    • Alexland
    • By Alexland 13th Apr 18, 12:23 PM
    • 3,110 Posts
    • 2,453 Thanks
    Alexland
    Aah in which case is that enough?
    • stoozie1
    • By stoozie1 13th Apr 18, 12:58 PM
    • 608 Posts
    • 566 Thanks
    stoozie1
    Should be, I assumed we'd be on similar earnings to now, and used the MSE calculator as to what our top up would be expected to be.
    Save 12 k in 2018 challenge member #79
    Target 2018: 24k Jan 2018- 560 April 2670
    • MallyGirl
    • By MallyGirl 13th Apr 18, 3:22 PM
    • 2,954 Posts
    • 7,951 Thanks
    MallyGirl
    I only have one DD but she is looking at a 6 year degree and she will only get the minimum maintenance loan so that is 25k + from us just to survive, without looking at repaying any of the loans
    • Fatbritabroad
    • By Fatbritabroad 14th Apr 18, 9:23 AM
    • 425 Posts
    • 219 Thanks
    Fatbritabroad
    As above any figures supplied will be meaningless. It depends whether the parents are millionaires or deeply in debt.

    An 18 year old will have plenty of expenses to cover. They may be thinking about a house, car, and univeristy. All the most expensive things just when they have the least. So anything will be welcome.

    The earlier you invest the more time there is for it to grow, so I put the bulk of it in early. I still contribute some each year but that may decline over time.
    Originally posted by Reaper
    Very good point. One i kind of wish my family had considered. Wealthy parents and grandparents who never made any provision for me. Not that that is an inalienable right and ive done fine by myself (and quite like the fact that i dont owe anyone anything) but parent has become remarkably generous now hes retired and I know my grandparents have inheritance for me. While welcome of course and I'm grateful Would have been far more useful when i was trying to buy my first place at 21. I think theres often a patronising view that 21 year olds will blow money theyve been given. Understandable but if said 21 year old is trying to buy s house that would suggest they arent going spend it on a porsche
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