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What type of account for grandparent financial gifts?

2 replies

busymyfoot · 04/12/2023 21:07

I have two DC's age 19 and 17.
The 19yo already has a cash LISA (which is fully topped up to the max of £4k for this year, and I was planning to top it up annually myself) and an adult S&S ISA (not fully topped up).

The 17yo has a Junior S&S ISA (not fully topped up), and will get a LISA when he's 18 (which I will be contributing to).

Otherwise, they both have current accounts, and linked instant-access savings accounts with modest interest rates.

Their grandparents want to start gifting them (and their 2 cousins) some money "from time to time" towards future house deposits. They were cagey about how much or how often and I didn't want to ask too many questions. It will probably be surplus pension income or savings as they don't get out and about much these days. (They mentioned separately that their 'estate' is below the IHT threshold, so I don't think they're worried about any annual limits).

They have asked me to tell them what accounts they can pay into, so I need to decide whether to suggest existing accounts or new ones. They would like to gift the money directly into a 'savings' account, not into current accounts, so it is clear that it is 'put away' for the long term.

They would be able to gift directly into DS2's S&S JISA, but only until he turns 18. They can't gift directly into DS1's adult S&S ISA. In any case, I suspect they would feel uncomfortable about gifting to S&S accounts.

I've been looking for alternatives. We're with Nationwide. Most of their savings accounts with decent rates seem to either require a one-off lump sum, a monthly savings commitment, or have a monthly limit, none of which seem appropriate for adhoc unspecified cash gifts.

Any suggestions for adult accounts, with decent rates, that can be gifted to on an adhoc basis?

OP posts:
messybutfun · 05/12/2023 11:55

Cash ISAs for both (kids can open one from 16) - make sure the grandparents know how much allowance they have each left so they don’t put in more
BTW the 17y old gets full cash ISA allowance as well as full JISA allowance - 19y old only gets £20k in total

busymyfoot · 07/12/2023 22:31

I'm finding that adult isas and savings accounts have restrictions on who can pay into them - probably an anti-money laundering thing. They all seem to want payments from the account holder's linked current account. Exceptions seem to be LISA's and JISA's, which allow gifting if you fill in a form, but those aren't good options for us.

If anyone knows of a provider that does enable gifting into adult savings accounts and isas, please let me know and I'll take a look.

OP posts:
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