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  • FIRST POST
    • ChocolateHelps
    • By ChocolateHelps 12th May 18, 5:04 PM
    • 2Posts
    • 0Thanks
    ChocolateHelps
    High interest kids savings account
    • #1
    • 12th May 18, 5:04 PM
    High interest kids savings account 12th May 18 at 5:04 PM
    We have saved regularly with Halifax 'Kids regular saver' for both our children from birth (now aged 12 and 9) which is linked to a Young Saver account which has the balance from the regular saver moved into the the young saver at the end of every year. We have saved Christmas and birthday money into the young saver as well. This means both children now have a lot more than 5000 in their Young Saver accounts. Today I received a letter to say the Young Saver now pays interest of 2% on funds up to 5000 and then it drops to 0.2%. It used to be 2% up to 20,000.

    What's the best place to move my childrens savings that are over the 5,000 threshold? They would both have more than the current Junior ISA max for the tax year. Ideally I'd like a normal savings account that I can transfer the money in their name but with me as trustee that sits and gains a decent interest (2% or more) until they are both 18.

    Thanks in advance
Page 1
    • xylophone
    • By xylophone 12th May 18, 5:22 PM
    • 26,492 Posts
    • 15,733 Thanks
    xylophone
    • #2
    • 12th May 18, 5:22 PM
    • #2
    • 12th May 18, 5:22 PM
    You are aware of the "100 rule"?

    https://www.gov.uk/savings-for-children

    http://www.thisismoney.co.uk/money/saving/article-1583863/Best-savings-rates-Junior-Isas-children-s-accounts.html

    Some providers do not permit the account to be held in trust beyond age 16.

    Since you are content for the children to have access and control at age 18, using the JISA would be easier all round?
    • louloubelle79
    • By louloubelle79 12th May 18, 5:28 PM
    • 367 Posts
    • 193 Thanks
    louloubelle79
    • #3
    • 12th May 18, 5:28 PM
    • #3
    • 12th May 18, 5:28 PM
    You could use 2000 in https://www.santander.co.uk/uk/current-accounts/123-mini-current-account for the 3% rate
    • MallyGirl
    • By MallyGirl 12th May 18, 6:15 PM
    • 2,957 Posts
    • 7,958 Thanks
    MallyGirl
    • #4
    • 12th May 18, 6:15 PM
    • #4
    • 12th May 18, 6:15 PM
    Originally posted by louloubelle79
    If they get the mini they can then open a RS at 5% on 200 pcm as well
    • unkle
    • By unkle 12th May 18, 6:18 PM
    • 84 Posts
    • 52 Thanks
    unkle
    • #5
    • 12th May 18, 6:18 PM
    • #5
    • 12th May 18, 6:18 PM
    Nationwide pay 2.5% if you make no more than one withdrawal a year. Up to 50k.
    • ChocolateHelps
    • By ChocolateHelps 12th May 18, 8:23 PM
    • 2 Posts
    • 0 Thanks
    ChocolateHelps
    • #6
    • 12th May 18, 8:23 PM
    • #6
    • 12th May 18, 8:23 PM
    Thanks everyone. I'm aware of the rule that the money paid in can't earn more than 100 in a year if given by parents but their accounts have built up over the years with a mix of gifts from family for birthdays and christmas. We currently give them both 300 per year (25 p.m) so I'm pretty sure the accounts aren't earning anywhere near 100 in interest each year from our direct savings.

    I like the look of Nationwide up to 50k at 2.5%. They already have 3 other accounts with the original CTF, a bunch of NS&I investments from grandparents and premium bonds that I need to keep an eye on, as well as our own insurance and utility bills to keep ahead of the best rates that I really need to stick all their cash (approx 8k & 11k) in an account that can simply keep track with inflation and not worry about until I hand over to them each at 18 yrs old (with as much financial education as I can drum into them between now and then!)

    Thanks everyone for your replies.
    • xylophone
    • By xylophone 12th May 18, 9:31 PM
    • 26,492 Posts
    • 15,733 Thanks
    xylophone
    • #7
    • 12th May 18, 9:31 PM
    • #7
    • 12th May 18, 9:31 PM
    They already have 3 other accounts with the original CTF,
    https://www.skintedmintedmum.co.uk/minted-blog/how-to-transfer-a-child-trust-fund-ctf-to-jisa-with-a-double-scoop-of-tax-allowance.html

    It could be possible to act as explained above.
    • michaels
    • By michaels 12th May 18, 9:46 PM
    • 21,280 Posts
    • 98,526 Thanks
    michaels
    • #8
    • 12th May 18, 9:46 PM
    • #8
    • 12th May 18, 9:46 PM
    As they are long term savings can you not use some of the longer term products (like the ns&i 3 year fix) rather than instant access.

    WE have maxed out the NWide and have about 40k spread between the halifax and lloyds identical offerings (don't forget you can have lloyds and halifax for each child, previously 20k now 5k). Rate change is 21st July.

    I discovered this week that the 100 interest treated as child earning is per parent not per child - who knew?
    Cool heads and compromise
    • Alexland
    • By Alexland 12th May 18, 10:15 PM
    • 3,121 Posts
    • 2,456 Thanks
    Alexland
    • #9
    • 12th May 18, 10:15 PM
    • #9
    • 12th May 18, 10:15 PM
    If they get the mini they can then open a RS at 5% on 200 pcm as well
    Originally posted by MallyGirl
    Not at age 12 and 9 as the minimum age for the Santander 5% RS is 16?

    Alex.
    • MallyGirl
    • By MallyGirl 12th May 18, 10:44 PM
    • 2,957 Posts
    • 7,958 Thanks
    MallyGirl
    Oops - sorry, I hadn!!!8217;t realised that as DD is 16
    • eskbanker
    • By eskbanker 13th May 18, 12:41 AM
    • 8,013 Posts
    • 8,928 Thanks
    eskbanker
    I discovered this week that the 100 interest treated as child earning is per parent not per child - who knew?
    Originally posted by michaels
    Me, for one
    It's always difficult to condense and simplify HMRC rules and regulations but it would be more accurate to say that if the child's money gifted from parents earns more than 100 per parent (per year) then it's taxed as your income not theirs.
    Originally posted by eskbanker
    • toothdoctor
    • By toothdoctor 13th May 18, 8:18 AM
    • 21 Posts
    • 19 Thanks
    toothdoctor
    So does that mean that my child can earn 200 interest before declaring to hmrc?
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