where to move out of NS&I premium bonds

[carmexmum]

My DS (3y) has a small holding in premium bonds (£5k) and his prize winnings over the last 2.5 years have been less than 1%. How better can I store this money for him? TIA!

Presuming he does not need the funds for another 15 years or so I would be looking to put it in a global tracker e.g. Vanguard FTSE all world ETF (VWRL). Long term you should get 12% ish annual interest on average giving him a pot of £27k by 18. You could also hold this in a stocks and shares ISA to shelter from tax.

thank you

Bear in mind if it is his name when he gets to 18 he can spend the money on what he likes! I'd keep it in my own name earmarked for him. I agree with previous poster a world tracker etf with low charges.

You don’t get interest on VWRL, it’s dividends.

It is a Junior ISA you will require.

Anticipated long term growth on a Global Tracker based on historical data is 8.4%.

it primarily won't be dividends, VRWL isn't a high dividend paying fund, its primary focus is to give exposure across global markets both developed and emerging to delivery growth.

The other poster saying you will likely get a 12% return on average is being overly optimistic.

That being said investing over the course of 15+ years is likely a good option in an ISA as long as you won't need the money in the meantime.

Definitely a S&S ISA

I started one for my 8 year old when he was born and the average annual return has been 14% - I don't necessarily expect that to be the long term return but it's certainly way better than premium bonds.

It’s VWRL not VRWL.

It pays dividends, not interest.

Following with interest...

Hi, can’t find the VWRL on vanguard… is it still available?

Try VWRP

https://www.vanguardinvestor.co.uk/investments/vanguard-ftse-all-world-ucits-etf-usd-accumulating/overview

VWRL and VWRP are the same only one reinvests the dividends and one pays them out. In your situation reinvestment would be the right option, VWRP.