AIBU to avoid junior ISAs because children get access at 18?

[flipfloplaugh]

I was about to start a junior ISA for my kids when I realised they would get the money no strings attached at 18. That's insane!! They're small at the moment, and I have no idea what they will be like at 18... I would have probably wasted a bit of it at 18, but several of my friends would have blown it all almost instantly on absolute nonsense. The v few people I know who have trust funds have trustees to stop daft usage and don't get the money until at least 25 and possibly later. Why on earth would I save money now to have it potentially wasted by some dingbat 18 year old??

@Echobelly The problem is you can teach them all you like, but some won't learn, others will be very sensible at 10, 12, even 14 then wander off the rails for a while.
You don't know in advance who will stay sensible and who won't, and by the time you have saved into a JISA you lose the choice and control.
Whereas if you save in your own name you can choose to handover at 18, or delay until 21 or 25 dependent on circumstances at the time.

We had a ‘child trust fund’ the thing before the Junior ISA. We saved £20 per month for 18 years per child - about £15k was handed to each child. Both are very financially aware, both opened a LISA with the money, and ISA. Both have worked part time from 16. My regret is not saving more for them. Neither are going to Uni. Eldest now working and has just purchased their first flat at 20 years old.
I was really scared that they would waste the money we gave them, and we gave in stages. Trust fund no control, Halifax saver - when we believed they could control it. ( another 15K made up from birthday gifts from family and a small inheritance from grandparent)
All through their childhood we talked about money and investments, we tried to educate them. But it could have gone wrong. I have a friend whose child has spent the money, make up, clothes and going out.

Absolute luck of the draw as to how sensible they are.

I really wish I'd realised before setting them up and moving the money in as we can't now move it out.

We've stopped putting money in and instead have other accounts we put in for.

I also don't intend to tell them about the junior ISA.

We decided against saving in their names for this reason. I have set up accounts in their names which I put €10 into each month and a grandparent puts a bit in on their birthdays. So they'll have a nice little amount of their own to maybe go travelling with or put towards a car etc. But "their" main savings are in my name. I don't intend to tell them about this money but rather give it as needed, ideally for a house deposit if we can hold out that long. We have quite a few 3rd level options in our city, but if they choose to go to university away from home we may need the money then, although I would also expect them to have a part-time job.

For oldest DC I'm going to take the chance, as they have to learn some time - on the whole they are very mature and sensible but they're not that good at keeping hold of their pocket money (whereas DS is actually good at saving his up for stuff he wants). The ISA is not enough money that they'll have ruined their future if they do burn through it, but it's enough money to learn something about managing it from.

We save a small amount for them into JISAs, which includes gifts they got at birth from others. I think it will amount to a few thousand when they get it, so enough to help them a little but not be a major issue if they waste it. Also a good lesson to learn.

I see everything we save outside of that as ultimately for them and their benefit anyway, and obviously we have the luxury of deciding what to do with it!

We had a child trust fund for our eldest dd that matured earlier this month. Shes off to uni in September and it will pay for two years of fees. From early teens she has known about it and we said this is what we have been saving for. It’s hers now to be sensible with, I know she won’t blow it. She has also had a Saturday for the last three years and has always been sensible about what is spent and what is saved.

Mine have junior ISAs. It not much in them. Mainly because eldest got the government child trust fund money so opened her an isa and then my youngest missed out on that so opened her one anyway and made them equal.

They also have other savings accounts that I manage. One they have is via building society using a passbook. It started off mainly as somewhere we saved money each month to then get back out for things when needed such as uniform and Christmas and birthdays. I’ve been fortunate not to have needed to access it more recently and they’ve built up about £3k. they also both got some compensation from an accident a number of years ago, not a lot but it was added to that account at the time. They could both access them from the age of 9 if I recall when we went in and asked one day but my name stays until 16. I just keep the books safe. Eldest is now 16 and my name was taken off her account, and she came with me to withdraw some money for something she wanted to do - a residential trip that was costly. But then i’ve kept the book still and add to it monthly. She’s autistic and very sensible. They both know where I keep the books but neither have thought about trying to use them. I’ve talked about giving them the books when they need something like driving lessons or uni. Youngest would blow the lot in a day!!

They also have an online savings account I put some money in from inheritance that could be accessed unlike their ISAs which I also added to. These have been used towards bigger purchases.

They also both have 2 grandparents and an aunt saving for them separately as well - I gave them birth certificates so know they’re in kids’ names. 1 grandparent says they will get it when she dies and not when 18. Not sure how that will work though as it all goes to that grandparent’s address and is an online saver. Aunt has said they will get her account when they’re 25 but again not sure how that’ll work once they turn 18. I’m guessing they could technically get access if the really wanted from 18. Other grandparent saved in some kind of policy which matures at 16. Technically eldest should have got access when she turned 16 but ex h intervened and had it transferred to him before her birthday (his parent set it up ) and said she will get money at 18. Their cousins got theirs at 16 so mine is missing out but doesn’t need it for anything specific.

I’m hoping though that if they do get access at 18 to all three accounts that they will be sensible. Youngest is a spender and now’s pocket money as soon as it is given but does have a few bigger pored things she wants to save for. Eldest doesn’t spend so just puts birthday and Christmas money into her saver connected to her own current account, so guessing she will be fine when she gets access. The downside for her is if she struggles to find work due to her autism and associated other difficulties she could potentially risky have too much in savings from others to be able to claim UC. And if the accounts the grandparents and aunt have aren’t handed over to her at 18 UC condo potentially locate them and suggest she lives off them. She might get a job, uni is a possibility but we don’t know how things will pan out.

I had one set up.for my son and just didn't tell him about it

I had my kids' savings in a kids' account until they were both 16 then moved it, so they couldn't have access until they're ready. This meant that I didn't have to lose out on my own ISA allowance.

You could always teach your dingbat 18 year old how to manage money..

Rubbish. I’m 50 and after years of slog and child-rearing and mortgage payments, the fun is just beginning! At 50 it could allow them to take early retirement and travel the world. Or put kids through uni or pay for weddings, cars, house deposits, or pay off their own mortgage…

Mine have JISAs and they also have savings in my name, their own Monzo cards used for travel and their own bank accounts with saving and spending pots through Lloyds.

They don’t know about the JISA money. But they are being taught all the time about money, investing, wise spending and they understand compound interest. If, at 18, this money comes and they blow it, well hopefully it’ll be either great fucking fun or a hard lesson. Fingers crossed they use everything they’ve learned to spend or invest it sensibly, but who knows? I don’t care, they’ll still have the “back up” money in the accounts I control for now. They have to learn somehow and I can only do my best to teach them and let them learn in adulthood too.

It’s nowt to do with trust. It’s knowing your child and realising they are shit with money no matter how much advice you give them. They can earn and waste their own money but I don’t want to see my wages being wasted.

Surely it depends on financially educating your child and then having the sensible conversations at the time around investments and money. I'd hope for that but may be naive! Do people just stop talking to their kids at 18?

Bring them up properly and they will take the 30k you have saved and stick £8000 in a Lisa and put the rest in sticks and shares. Proud of my 20 year old.

Stocks, just blind.

Mate, I was paying rent and bills at 18.
Give them some credit ffsake.

I agree with this, it’s all very well saying if they waste it then on their own heads be it, but I’m not in a financial position to be wasting thousands of pounds. If they’ve earned it then they can spend it as they see fit.

Of course not, but you’re assuming that they’ll listen at 18.

I have 3 DCs. 2 of them are ultra-sensible with their finances, big pension contributions from the day they started work, bought houses in their mid 20s. The 3rd spent her trust fund at 18. She took her friends to Marbella for a week. All gone. She is a fiscal nightmare. We’re a few years on now and she is still at home and never saved a single penny.

We've been advised to change address to a grandparent when child gets to 17. That way notice of transfer to child can be intercepted if necessary and child not told u till they are more sensible. Alternatively just look out for the post.

"intercepted"
Who is advising you to commit fraud?

Wow.

if you really, really don’t want them to have access to it, to the point you’d commit fraud, why even save for them at all?

I’m not even sure you can do that as the banks usually need proof of address change, so unless a parent or child is living at the grandparents house and has documentation to show it…

it’s very, very easy for banks, and the police to trace address fraud. There are databases which will show where your bank accounts, mortgage etc are registered.

just keep it in your name. No fraud needed.

When my child turned 7, I started giving him pocket money, £2 a week. £1 to put in his piggy bank to spend when he wanted, and 2 x 50p to go into 2 savings pots, one to open when he was 8, and one to keep until he is 16. His piggy bank already had about £30 in it. I let him spend it all on Minecraft add-ons, as long as he brought me the money and told me how much change he needed, I paid for them with my card.

It took him about 3 months to run out of spending money. Then I explained he could either wait and save up his pocket money for what he wanted or do some work to earn it. The first time he chose to do some work, at other times he’s decided it doesn’t want it that much. When he turned 8 he was excited to open his savings pot, count up his money and go buy something he wanted. We started a new pot he’ll open when he’s 9, and his pocket money has gone up to £3 with the same split.

I’m hoping he’ll learn the value of money by the time he’s 18 - he has a cash JISA , s&s JISA and Premium Bonds, I’m expecting him to have around £40k at 18. He also has a JSIPP, I’m hoping it will be worth around £2m when he reaches 57, but of course I can’t predict share values! In between 18 and 57 I expect he will inherit something, so he basically has three chances in life! If, like me, he gets it wrong twice, I’ll be glad I set up the SIPP for him.

As a parent who had savings accounts for my 3 sons which they could access at 18, only my middle son wasted the money he got ( around £8000 ). He purchased a new computer and blew the rest on going out, fruit machines. He is now 36 and very sensible with money. My other 2 sons spent theirs wisely, eldest used his as deposit on his 1st home when he was 22 and youngest son went private for an operation when he was 18.