Child savings accounts.

[Rainbowsparkles29]

Not a massively adoption-specific topic although perhaps one that adoptive parents are more reflective of due to some of the common difficulties AC experience....

We've just opened up our 5YO a child savings account. I hope to save her up a fair bit of money by the time she turns 18. However, I'm quite nervous about her suddenly having access to so much money at this age. To me modern kids are typically quite immature still at this age and lacking in life experience. There's every chance they won't really have done much paid work and will still be living at home/uni. Although I see no reason right now not to trust that my dd will spend/invest this money wisely I do think it's a big temptation for any 18YO to spend it wisely, perhaps especially so for an adoptee who may develop additional difficulties. I see the options to be...

1. Let dd do what she wants anyway and accept that I'll have no real power to interfere

2. Put a little money in a child savings account to be able to show and demonstrate saving to dd but save the majority in an account under mine/DH's name so that we have more control over what it's spent on

3. Don't tell dd about the account or hide her bank book until we're satisfied that she's able to cope with it (more difficult as she'll likely receive correspondence about it and not really an option I'm keen on since it's a bit covert)

4. Take her to the building society and try our best to insist she transfers the money to an adult savings account although I'm aware she really wouldn't be able to force this

What have other parents done/planned to do? FTR we absolutely plan to encourage handling of money and financial literacy in her from a young age but I'm aware that doing this is by no means foolproof

To be honest if I wanted to save a significant amount eg for a car, uni, house deposit I'd just open another account in my own name to have control of it. Once she is an adult you cannot 'insist' on anything

If you want her to learn to manage money I'd be more inclined to get her something like a gohenry card and regular pocket money.

I gave my son pocket money from a young age. When he was 14 he got a newspaper round - when he wanted to buy something we talked about how many rounds he would have to do to earn that money - then he could decide if it was worth it. He got a Saturday job at 16 and we opened a current account with debit card for him. I've always letting him handle the money himself. He made a few mistakes such as signing up for free things and then not cancelling before he had to pay but he learnt quickly.
A big lesson was him taking £40 out of his piggy bank, treating his friends to sweets and coke after school for a week and me then refusing to pay for him to go to the cinema.
He is working more or less full time now at Tesco and seems to have his head screwed on money wise - saving for university in October.

Save in an account in your name. Complete no brainer for me.

Let them have their own savings for birthday money from family, but not swathes from you.

Even without adoption the most sensible 8yo can be off the rails by 18. Throw adoption into the mix and you have no idea how things will go.

You absolutely can't legally keep money hidden once they are 18 if it is in their name.

I’d keep it in my name too. My kids both have GoHenry cards for pocket money and birthday money, but money I’m saving for them is in my name. My DS10 is very money wise and saves for big purchases, understands the idea of earning money etc, my DD11 has no impulse control and spends every penny as it arrives. I’m hoping that will change as she gets older but I wouldn’t give free access to a large amount until I know she can use it wisely.

I've been thinking about this recently as well. Currently looking into Junior Pensions, which I didn't even know existed until recently! Don't have much to say on them as I'm still researching, but might be something worth considering?

That sounds interesting. But also sounds like something they can't access until they are 65...

yes @UnderTheNameOfSanders junior pensions can’t be accessed until pension age

@Rainbowsparkles29 why do you want her to have money at 18?

Saving for something specific like a flat/house deposit, a car, uni, wedding I completely understand. But I’m not sure of the point of just having a wodge of money is helpful to all but the most sensible of 18 year olds, adopted or not.

I’ve never been in a position to save much until very recently. My son is now 18, working and saving himself. He knows what he wants to achieve.
I am fortunate to be receiving an unexpected lump sum in the summer. I will buy him a car and insure it for the first year and give him a couple of thousand for uni. A chunk of my pension lump sum is earmarked for him for his house fund,
we will also be opening a LISA for him which he can only use for propery purchase

I have two adopted children.

I would set up a savings account for her pocket money/ birthday money. An account that can be raided as and when it used to save up for specific things.

If like us you wanted to save money for a car or uni costs or similar then don't tell them about the money.

We made the mistake of telling our DS that we were saving up for when he was 18.

My DM has also been saving up and decided to give him control of the money (£5k) at 16 because she knew he wanted to buy a car as soon as he reached 17.

This prompted DS to ask us how much we had saved as he wanted to work out how much of a budget he'd have for a car. We told him he had another £5k coming from us.

He then decided to spend the entire amount on a ridiculous car for a 17 year old whereas we'd have preferred him to get a cheaper , more insurance friendly one. He has no cash left now but he has a decently paid weekend job to pay for insurance and petrol etc.

We lost control of that situation as we were a bit blindsided by my DM deciding to give him the money 2 years earlier than we were expecting so we will be more careful about managing it when DD reaches that age. I think my DM realises this too so will hopefully hold back ( especially as DD is even more likely to be reckless and make terrible decisions!)