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    • gash
    • By gash 13th Apr 18, 9:01 AM
    • 50Posts
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    gash
    Investing £70,000 for a child
    • #1
    • 13th Apr 18, 9:01 AM
    Investing £70,000 for a child 13th Apr 18 at 9:01 AM
    My mother wants to give my daughter £70,000 - part of a recent inheritance she received. What is the best way to invest this for a child? The main issue is the money being safe. I don't want anything high interest where the money may be at risk. She would also be happy with it being tied up for a fixed term, like 5 or 10 years so daughter receives it when she's approx. 18 years old.


    Thanks in advance!
Page 2
    • Alexland
    • By Alexland 13th Apr 18, 8:52 PM
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    Alexland
    £70,000 wouldn't be enough to cover seven years (assuming the OP's daughter went at 11). Current fees for a day school will be well in excess of £10,000 p.a. (the cheapest are around £11,500) and these will rise every year.
    Originally posted by ValiantSon
    There are some backed by some pretty huge charitable or religious trusts that cost less.
    • Zorillo
    • By Zorillo 13th Apr 18, 8:54 PM
    • 295 Posts
    • 173 Thanks
    Zorillo
    Consider Bailey Gifford Children's Saving Plan perhaps? No maximum limit, and if you do it as a designated account it stays in your name. I'm sure other similar plans exist, but this is currently my planned next move when I'm happy that the JISA has enough in it.

    https://www.bailliegifford.com/en/uk/individual-investors/how-to-invest/childrens-savings-plan/
    • gash
    • By gash 13th Apr 18, 8:58 PM
    • 50 Posts
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    gash
    Will check it out Zorillo. Cheers!
    • Alexland
    • By Alexland 13th Apr 18, 9:05 PM
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    Alexland
    Although I am in favour of the BG CSP (have recently opened one for our son to regular invest in Monks investment trust) be careful of dividend and capital gains tax when considering large sum unwrapped investments.
    Last edited by Alexland; 13-04-2018 at 9:08 PM.
    • xylophone
    • By xylophone 13th Apr 18, 9:24 PM
    • 26,135 Posts
    • 15,486 Thanks
    xylophone
    I take it that this money is an absolute gift to the child.

    If this is the case, then you will hold it in bare trust for her and she will be absolutely entitled to access and control at the age of 18.

    Does she have a CTF/JISA?

    http://forums.moneysavingexpert.com/showthread.php?p=74149187#post74149187

    You might consider setting aside around £25.000 into a Nationwide Smart Limited Access account and gradually moving into JISA.

    You might consider opening a stocks and shares account in bare trust with the balance and investing in a balanced multi asset portfolio.

    http://www.hl.co.uk/investment-services/investing-for-children

    http://monevator.com/using-vanguard-lifestrategy-funds-life/

    http://monevator.com/low-cost-index-trackers/

    https://www.vanguardinvestor.co.uk/investing-explained/stocks-shares-junior-isa
    • theoretica
    • By theoretica 13th Apr 18, 9:41 PM
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    theoretica
    Hi. Thanks for the response. It is something I will consider. But if I'm honest, my ex wife, my daughters mother, is aware of the 70k being given to our daughter (in my care), and if I managed to lose some of it, I'd never hear the end of it and probably have to make the shortfall up myself.
    .
    Originally posted by gash
    A way round this might be to discuss this with your mother. If the money was given to be invested then you would be able to say you were following the donor's wishes.
    But a banker, engaged at enormous expense,
    Had the whole of their cash in his care.
    Lewis Carroll
    • justme111
    • By justme111 13th Apr 18, 10:44 PM
    • 3,020 Posts
    • 2,916 Thanks
    justme111
    Consider Bailey Gifford Children's Saving Plan perhaps? No maximum limit, and if you do it as a designated account it stays in your name. I'm sure other similar plans exist, but this is currently my planned next move when I'm happy that the JISA has enough in it.

    https://www.bailliegifford.com/en/uk/individual-investors/how-to-invest/childrens-savings-plan/
    Originally posted by Zorillo
    I keep asking this question every time someone mentions plans like this as I don't understand - if the investment is in YOUR name as it appears to be what is the difference between it and any other investment in any other fund that does not have "designated for a child label on it ? What stops one from opening ANY investment and calling it " for a child" for the purposes of keeping tabs on what is where ? Why recommend this particular one over zillion of other platforms and investments ? Sorry I genuinely don't understand.
    • ValiantSon
    • By ValiantSon 14th Apr 18, 4:11 AM
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    ValiantSon
    There are some backed by some pretty huge charitable or religious trusts that cost less.
    Originally posted by Alexland
    Namely?

    Ignoring bursaries and scolarships (which are not guaranteed until they are offered), I am unaware of any independent day school charging significantly less than I quoted. (The Independent Grammar School, Durham, would be one if it had yet to actually be accredited as a school by the DfE - and I will be amazed if they are going to be able to survive with the incredibly low fees that they propose).
    Last edited by ValiantSon; 14-04-2018 at 4:13 AM. Reason: Typo
    • Alexland
    • By Alexland 14th Apr 18, 6:07 AM
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    Alexland
    Our local Catholic school, which seems to be providing a good education to our friends children, charges under £600 per month over 12 months including wrap around care until 6pm and cover for school holidays if desired. Admittedly this is at primary but in supporting both parents to continue working would enable money to be put aside for when the fees get a bit more expensive in secondary years.
    • ValiantSon
    • By ValiantSon 14th Apr 18, 6:14 AM
    • 2,537 Posts
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    ValiantSon
    Our local Catholic school, which seems to be providing a good education to our friends children, charges under £600 per month over 12 months including wrap around care until 6pm and cover for school holidays if desired. Admittedly this is at primary but in supporting both parents to continue working would enable money to be put aside for when the fees get a bit more expensive in secondary years.
    Originally posted by Alexland
    Thanks for that. I was specifically talking about secondary schools (as I said, "assuming the OP's daughter went at 11"). Primary and prep schools are cheaper than secondaries. Mean average fees for a day school at secondary level would be around £14,000 per annum (skewed somewhat by some very expensive fees for particular schools), and as I said, the bottom end would approach £11,500.
    • Alexland
    • By Alexland 14th Apr 18, 6:18 AM
    • 3,017 Posts
    • 2,360 Thanks
    Alexland
    I keep asking this question every time someone mentions plans like this as I don't understand - if the investment is in YOUR name as it appears to be what is the difference between it and any other investment in any other fund that does not have "designated for a child label on it ? What stops one from opening ANY investment and calling it " for a child" for the purposes of keeping tabs on what is where ? Why recommend this particular one over zillion of other platforms and investments ? Sorry I genuinely don't understand.
    Originally posted by justme111
    Yes if you don't go with the bare trust version it is just designated for the child. You can also get an adult plan with slightly higher minimum payments.

    Investment trusts have the ability to use conservative gearing (borrowing against their assets to buy more assets) which has the potential to increase the return compared to an OEIC fund. Most platforms would charge a share dealing trade cost (at least £5 with iWeb) so ITs are usually uneconomical for small regular contributions. However with the BG CSP there are no trade costs and the fund management costs are very reasonable.

    However in the case of a large lump sum then to avoid tax implications feeding into ISA(s) may be a more appropriate way to invest.

    Alex
    Last edited by Alexland; 14-04-2018 at 6:29 AM.
    • justme111
    • By justme111 14th Apr 18, 8:03 AM
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    justme111
    thank you !
    • MallyGirl
    • By MallyGirl 14th Apr 18, 11:20 AM
    • 2,879 Posts
    • 7,884 Thanks
    MallyGirl
    Namely?

    Ignoring bursaries and scolarships (which are not guaranteed until they are offered), I am unaware of any independent day school charging significantly less than I quoted. (The Independent Grammar School, Durham, would be one if it had yet to actually be accredited as a school by the DfE - and I will be amazed if they are going to be able to survive with the incredibly low fees that they propose).
    Originally posted by ValiantSon
    I donít think you will find any if you ignore bursaries and scholarships. Having been a Governor at an Indie I know that it would not be economically viable at much less (or quite a lot more depending on the location). There are a few places like Christís Hospital which set fees based on the ability to pay, but they are rare.
    • ValiantSon
    • By ValiantSon 14th Apr 18, 4:59 PM
    • 2,537 Posts
    • 2,488 Thanks
    ValiantSon
    I donít think you will find any if you ignore bursaries and scholarships. Having been a Governor at an Indie I know that it would not be economically viable at much less (or quite a lot more depending on the location). There are a few places like Christís Hospital which set fees based on the ability to pay, but they are rare.
    Originally posted by MallyGirl
    Yes, this is what I was getting at.
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