Investing for children

[hellololabells2019]

My grandad died and left our children 5k (15k total) each. This is currently in Premium Bonds but would I be better to look at S&S ISAs?

Have at least 13 years of investment until the eldest is 21. Intend to keep the money in my name.

Yes, as the trustee of that money you really should be doing what you can to at least maintain its real value (buying power) over time. Holding it in Premium Bonds will keep the capital intact but if there are no wins then the actual value over that length of time will be significantly eroded by inflation.

A sensible investment in funds is going to give it a much better opportunity to grow ahead of inflation over a medium to long term. Using an ISA is a tax efficient way of making such an investment.

Premium Bonds is the safest way of course, but prizes have dropped hugely lately and with £5k (or £15k if you’re pooling them together) it’s unlikely they’ll win a huge amount of prizes over the next 13 years. £5k in 13 years will be worth a lot less.

I’d do a tax free ISA. Not a huge difference, but saving is impossible these days

I'd do 3k in stocks and shares isa for them and 2k each in bitcoin.

S&S ISA, using a fund platform and a blend of tracker funds.

Hi All- the best way to inflation-proof money is to invest in stocks and shares. This can normally be done using an ISA or similar investment "wrapper".

Sadly, parents often make the mistake of investing into cash products, even cash ISAs. Overtime these lose value due to the impact of inflation which is normally ahead of the rate of return on cash.

I investing into portfolio of direct stocks and shares for my children using a mix of active investment funds and some tracker products. As the name suggests a "tracker" simply follows the market either up or down!