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Original poster

Savings for DD - who do you agree with?

253 replies

StrangeOrJustInconsiderate · 04/08/2019 13:08

Name changed!

DH and I are currently in the middle of a disagreement re: savings for DD who is 8 weeks old.

We have already agreed that any child benefit we may receive (unsure if we qualify at the moment) will go into a savings account for DD. However we are disagreeing over whether to top it up each month or not and if so what amount.

Person A thinks we should add an extra £100 per month we can afford this and it will have no real impact on our current lifestyles. Our child will be living in a different world when they are older and any extra help cannot go a miss, they also think we would be able to control / help what an 18 year old spends the money on.

Person B thinks that with any child benefit plus the amounts we and others will put in at special occasions (we are not assuming this is already my mothers plan) there isn’t a need to top it up. Neither of us had a savings account for when we turned 18 and we’ve done just fine. They are also concerned about handing over a large sum to an 18 year old is a recipe for disaster. Person B also says if we do top up it should be a max of £10 per week.

Who do you agree with?

OP posts:
flowery · 04/08/2019 16:34

”Yes, if he decides to take me to court to access the money he will win.

I’m no lawyer but surely he could just get access himself by going to the bank/wherever the money is, with sufficient ID? Why would he need to go to court?

Luckily I haven’t raised an entitled twat who would do that though”

Let’s hope you and he never disagree on what is or isn’t a good use of his money then.

PooWillyBumBum · 04/08/2019 16:37

Person A, but if you aren't using your full ISA allowance then I'd put it in a S&S ISA and keep a spreadsheet so you know what value of shares is/was theirs, then give to them when you trust the money will be spent wisely.

If they grow up to be a shit you can extend the house or go on a cruise.

MuttsNutts · 04/08/2019 16:40

@ScarletAnemone They are online accounts. Yes, he could gain access himself if he was so inclined but see above regarding lack of entitled twatness.

@flowery Ok yes, not literally to court. He could get access himself if he set his mind to it but also please see above.

We will never fall out over money. If he wants it for anything that much he can have it. No amount of money is more important than us having a good relationship.

Genevieva · 04/08/2019 16:42

Person B. Invest in your child, rather than in a bank by spending the money you were going to save on activities that improve her quality of life and offer her skills - musical theatre, music lessons, gymnastics, trampolining... whatever floats her boat as she grows up. These may just be fun parts of a well-rounded childhood, but they might open up areas of genuine passion and ability that lead to career choices in the future.

flowery · 04/08/2019 16:48

” Ok yes, not literally to court. He could get access himself if he set his mind to it”

Why the ? You’re the one who was on about he’d have to go to court to access his own bank account! I don’t think he’d even have to “set his mind to it” in order to access it, so I found it very odd you talking about you letting him have it when you choose to “gift” it to him.

”We will never fall out over money. If he wants it for anything that much he can have it. No amount of money is more important than us having a good relationship.”

Why don’t you trust him enough to not hide the log on details then, or whatever means you are using to withhold access from him at the moment?

ScarletAnemone · 04/08/2019 16:48

My DC are all past the age of 18 now. They have all been given money at various stages growing up.

In hindsight I think the ideal would be for the 18yo to have access to a nice sum of around £3k-5k. Enough for driving lessons, or travel, or to get them started at uni or whatever. It’s a big sum to someone of that age. There are some high interest junior saving accounts which would be ideal for that.

More than that can be overwhelming to a young adult, so I think it would be better to hold it back and gift it to them a bit later. That means either setting up a trust fund which they can’t access until a later age, say 23, or saving it in your own name and not theirs.

PleaseGoogleIt · 04/08/2019 16:52

DD's child benefit goes into a savings account, however, it's a savings account of ours and so it's not in her name and she won't have any access to it. She won't even know it exists until we feel the time is right to tell her.

secretsciurusvulgaris · 04/08/2019 17:04

DD stands to access a reasonably large six figure sum from a JISA at 18 with a similar amount in a SIPP by then. We will discuss and educate on investments and their management as she gets older.

I don’t understand the mentality that children should suddenly manage on their own once they turn 18 or that they will suddenly turn into hedonists. We see it more as a test - she stands to inherit a great deal more and we don’t expect her to touch the JISA at all. I’m with person A.

secretsciurusvulgaris · 04/08/2019 17:05

Obviously this excludes those who can’t actually afford to save for their children - rather those that choose not to.

MuttsNutts · 04/08/2019 17:07

@flowery I mentioned court because you brought up the legality of what I am doing.

I don’t hide anything. Don’t leave any financial logins lying about as is sensible I would have thought but DS could find them if he really wanted to. As I said earlier, he is fully aware of there being money for him, why it was put by for him and that it will come to him as and when he needs it.

At the moment, he has just finished his A Levels and is enjoying a last summer of freedom before university. He has had a job for the last year, earning himself enough to run a car and is going on holidays with both his mates and his girlfriend. He doesn’t need me throwing any money at him and said himself that he loves the feeling of earning for himself.

There will come a time when a lump sum or several smaller sums would be really useful though, either for a house deposit, to travel the world, to buy a car after university...whatever.

Not quite sure why you think the arrangement is so outrageous to be honest. DS is grateful that I have managed to put some of my money aside for him over the years, doesn’t seem to care whose name it happens to be in.

DinoGreen · 04/08/2019 17:19

We set aside £100 a month for my 3 year old DS’s expenses - clothes, shoes etc. Whatever we don’t spend goes into his savings account. Some months I hardly spend anything and he gets the full £100 or close to it, other months he needs new shoes and clothes and might only save £20. Any birthday/Christmas money also goes into the account for now - as he gets older, he will no doubt want to spend this himself. I’ll see what he’s like as he grows up and decide whether he should know about the account or not and get access to it when he turns 18. My parents saved a bit for me and I got access to it when I turned 18, it was about £2,500. It was drummed into me that this was not for frivolous spending but something sensible like a car. I did dip into it slightly a few times but ultimately didn’t spend it and it was used to pay the legal fees and removal fees when I bought my first house with DH at 24, so hopefully DS will inherit my sensible nature.

Greeve · 04/08/2019 17:20

Will this be your only child?

Dandelion1993 · 04/08/2019 17:28

We do what person b suggests.

Yes that £100 is nice but we put that in our savings for things like unexpected car breakdown, someone falls ill, loss of job. You have to plan and back up for those things first.

Pebbles574 · 04/08/2019 17:44

@MuttsNutts
Are you SURE you still have access to it?
When DS turned 18 all his 'child' accounts which were in my name as trustee transferred into 'adult' accounts (paying awful rates of interest, I might add).
When I tried to move the money into his S&S ISA I was told that he needed to attend a branch or send ID to take over control.

Where is the account held, out of interest?

Pebbles574 · 04/08/2019 17:47

Also, banks have a habit of writing to the 'child' just before or after their 18th birthday to make them aware of the account (money laundering regs) Are you policing his post in case that happens??

prettybird · 04/08/2019 17:50

When ds wanted to transfer the small amount of savings he had in his HBoS savings account that I had opened for him, into his debit account (because we'd found the savings book and realised he still had some money in it) fortunately I went with him as I still had to to sign the withdrawal slip, even though he's nearly 19 Shock

It was in his name but I was the trustee.

speakout · 04/08/2019 17:55

Also, banks have a habit of writing to the 'child' just before or after their 18th birthday to make them aware of the account (money laundering regs) Are you policing his post in case that happens??

I have no experience of this. commuication.

My mother opened a child savings account for my chidlren. The moment they hit 18 no one except them had accessto their accounts. No letters. Nothing. Befiore that my mother was able to check balance, make enquirey about interest etc, but an automatic blank at 18,

AngelasAshes · 04/08/2019 18:01

Btw- if the account is in the child’s name, they get full control at age 16 not 18

MuttsNutts · 04/08/2019 18:04

@Pebbles574 DS is aware there is money, just not how much, so no need to hide or police anything as everything is done online.

Out of interest, why do you consider what I’m doing to be any different to anyone that says they have saved money in their own names for their DC and will gift it to them as and when they need it? The only difference is that I’ve used U18 accounts while he was a child to get the most for him out of the money I’ve invested.

CherryPavlova · 04/08/2019 18:15

We’ve money saved and squirrelled away in our accounts for the children. They don’t get given a huge lump sum of cash at eighteen as the pay didn’t need it and weren’t ready to take full financial responsibility for such large sums. All money stays in our names and we decide how it’s spent in discussion with the children. We wouldn’t fund a drug habit or fecklessness. Any money comes with an expectation of sustained effort and achievement.

We help each according to their needs. We paid living costs and paid off loans on graduation but our son didn’t need this. We helped with house deposits and furnishings but one hasn’t reached that stage yet. We’ll pay for our daughters weddings but might not need to help as much with our sons because he can do a lovely wedding much more cheaply and I imagine his future bride’s family will want to pay for most things. We bought cars once they were needed and after very high risk teenage period was over; our youngest still has no car as she doesn’t need it. We have paid for flights for her and her boyfriend to see each other when she was doing her year abroad though. Likewise, we’ve just paid for our son’s girlfriend to fly out to the Middle East to see him during his mid deployment time off.

Pebbles574 · 04/08/2019 18:15

@MuttsNutts - I'm not questioning what you have done (I have done exactly the same!) only your belief that you still have control/access to it, as this hasn't been my experience with numerous accounts for DS:

Halifax ISA - Wrote to me & DS at 16 and sent a statement/ gave option for him to take it over
Wrote again to him at 18 saying he now HAD to prove identity/take it over. (NB - this was an otherwise online account)

Virgin - Both he & I had to sign form to transfer money out of a savings account after 18.

Skipton - Passbook account - sent him a letter before his 18th with a statement asking him to come into branch with ID.

In fact there is only one high street building society (begins with N....) where I can still see the account and move money (and I wonder if this is an error, which is why I'm not naming it!). However the rate has dropped like a stone after his 18th so I really need to find a new home for it.

His S&S Isa which is held on a funds platform sent him a letter and transferred automatically to him on his 18th and they won't talk to me now.

My son knew we had savings for him in his name, but not what, where and how much. That changed rapidly when the statements and letters started arriving.

To be fair, he's been good, hasn't touched a penny, and we've been working together on the best ways for him now to invest it.

Pebbles574 · 04/08/2019 18:17

AngelasAshes

Btw- if the account is in the child’s name, they get full control at age 16 not 18

Depends on the account - that might just be ISAs. Not my experience with some accounts anyway.

MuttsNutts · 04/08/2019 18:49

@Pebbles I really don’t think it wise to go into specifics online but yes, I definitely still have access.

Sorry OP, didn’t mean to derail your thread, just wanted to let people know there are other options Smile

boosterrooster · 04/08/2019 18:50

Person A. If you can afford to then absolutely top it up.

ScarletAnemone · 04/08/2019 18:51

MuttsNutts The difference is that it’s your son’s account, not yours. The bank should be ensuring that the only person who has access to the money is him. You were allowed to access it when he was a child but he isn’t any more.