Children's investments - what do you do?(12 Posts)
Hi, what kind of investments do you have for your children? I am looking to invest about £5k for the long term. My child is only 6yrs old. I would also add to it monthly
My son is a lot older than yours (16) but had a reasonably large inheritance last year of 30k and my husband and I were made Trustees of his money. We spoke to our financial adviser who wouldn't or couldn't invest for a minor so we had to research for ourselves the best interest savings account we could find for him. In the end the Nationwide came out best at a rate of 3%. We don't touch the money (although we could if we wanted to but he would lose some of his interest) but he is able to put more in and has added another £2k from an insurance policy his other grandad took out for his first car. I think the maximum he can have in the account is £50k but that's never going to happen I think he's secretly worked out how many x-box games he could buy with his money!! but hopefully it will be a deposit for his first home. Our hope is when he is 18 he will let us invest it for him again via our FA as the thought of an 18 year old with all that money is scary, but he's a good kid and knows his grandad would not want him to fritter it. Not sure if that helps?
We use Hargreaves Lansdown and have 4 different stocks & shares funds for our two DC. We invest £100 pcm and their GPs give us a £500 every April. We're playing the long game as our DC are 6 & 4 so 'play the odds' of stocks & shares over woeful interest rates.
I can't praise Hargreaves enough - they are exceptionally helpful.
I hope you don't think I'm being nosey Quiz but did Hargreaves let you put the stocks and shares in your DC's name or are they in yours?
This is all really helpful, thank you! I was going to try to read up and invest in my own but I work FT and I don't have the time and I think I do need the help of an advisor. I have dealt with H&G before so I'll give them a shout. Thx!
Oh and for what it's worth, Halifax is offering 6% on a children's account for one year, then it reverts to a 3% account I think. You can only put in £100 per month (minimum £10) but it's better than a kick in the pants!
I wish there was a place to discuss finances (this forum is not very active) because it still remains a bit taboo for such an important topic.
Have you thought about setting up a pension plan for your DC? We did this when our DS was born (putting in the value of the child allowance each month) - he is now 15 and has a reasonable pension pot - obviously he can't touch it until he is 65 - probably older but we see it as a long term investment.
My parents also invest for him in a stocks and share type plan - that should be enough to cover university expenses
if he is bright enough to go. He is a lucky boy !
It's worth getting advice from an IFA - the 'rules' about investing change all the time.
ds(11) has ~£17K from gifts/small inheritances/saving in bank accounts in his name with 3% tax free interest. Probably could invest better, but I'm very risk adverse.
I've also got another £6k in my workplaces shares (they do a Buy 2 Get 1 Free scheme) and adding another tax free £125/month. Also keep annual bonus shares. I need to keep the shares for 5 years before cashing in to keep them tax free. With the B2G1F shares they would need to drop to 60% of value (unlikely - touches wood) before making a loss so its a great deal.
I would say speak to an adviser (I am one so I'm biased) A good one will sit with you and answer any questions you have and help you decide what the best course of action is based on your circumstances. A common concern is whether you want your child to have access to the money or do you expect it to go towards a specific goal such as university fees. Your adviser can then talk you through the basics of investing and should provide ongoing advice, support and financial 'training' so that you understand and are comfortable with your investment strategy.
I hope this helps, good luck with your investment!
We did something completely different as we don't like high risk investments and the possibility of getting back less than you put in.
We saved and used a small inheritance to buy a house to keep long term, then we bought another to keep long term from the profits from renting out the first one.
We couldn't afford to save from when they were little but they have the money when they need it now they are older.
Icequeen, there are junior ISAs which can invest in stocks and shares before the age of 18. They have a smaller allowance than regular ISAs and fund choices are quite limited but they do contain stocks and shares. The child still gets access to the funds at 18.
Good luck selling the concept of delayed gratification www.youtube.com/watch?v=b_ubVVnWglk
Apologies, I haven't been online for a bit. That clip is hilarious and I certainly can see where you are coming from. Guess we just have to hope we have instilled a bit of sense into DS but I have to say judging by the way he has spent his pocket money almost as quickly as he receives it there is some cause for concern. We are encouraging him to get a Saturday job once his GCSE's are out of the way in the summer in the hope he will learn the value of money - so fingers crossed
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