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New pension reform - investing for child

(6 Posts)
jaabaar Sun 23-Mar-14 10:47:47

Hi

We are paying into a pension fund for our 4 year old to help her having a regular income when she is old which could be more substantial then starting later in life.

Now with the new reform she can draw all the fund at retirement age.
Is it possible to put a clause restriction to not be able to draw all the funds?

This is my husbands question......

I personally think it is a silly question as it is in her name and she hopefully will make her own contributions so nobody can put restrictions on her money.....

We just have to make her aware to be wise.

What do you think?

specialsubject Sun 23-Mar-14 10:50:59

I really wouldn't worry about a problem that is sixty years and twelve governments away! The rules may have changed again many times by then.

I would consider restricting access to money for 18 to 25 year olds, but your daughter will be in her sixties and you may be long gone. I hope by then she will be financially responsible - and if she isn't, it won't be your problem!

TalkinPeace Sun 23-Mar-14 17:23:44

pension
bargepole
touch
not
a
with

ISAs on the other hand ....

CogitoErgoSometimes Sun 23-Mar-14 18:01:57

Blimey.... step back from the big red button marked 'CONTROL FREAK'! The thing about setting up money pots for your kids - whatever form they take - is that it involves a degree of faith in your ability as a parent to educate the little darling on responsible financial management. Because, if not, you might as well put it in your own accounts and then dish it out to them only when you've decided that they are worthy of your bountiful gifts smile .....

jaabaar Sun 23-Mar-14 20:52:16

CogitoErgoSometimes
Thank you very very much! My very exact words! I will show to my hubby!
It is exactly what I believe in! It is up to us parents to give our children the tools which THEY can use to lead a responsible independent life! We can only teach and lead by example and hope they hopefully and eventually can use those tools!

If u put money in an account in your child's name it is THEIRS! They even become responsible to pay tax on them!

TalkingPeace
And again thank you as well! This was my suggestion! Much better in my view then a pension!

Thanks for your valued opinions!

SpecialSubject
Agree, all comes down to take your responsibilities.

specialsubject Sun 23-Mar-14 22:00:52

The problem with ISAs is that you can only put in so much at a time, but then a four year old has a LOT of time to build up cash. Trouble is that there's no way of making it inaccessible at 18 - and the squander bug could well hit then. Pensions will be locked until much later. But you have (I hope) much more chance of being around when she is 18 and as others say, there is time to educate that money is not to be guzzled or smoked.

rates on cash ISAs are terrible at the moment, below inflation.

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