If you have savings for your children ...

[yoursworried]

Are they in an ISA in their name or in yours? DH and I have some stocks and shares Junior ISAs for our two DC who are currently 4 and 6. They are currently only at around 3k each but we hope for 10-15k in each by the time they are 18. (We are about to earn quite a bit more).
I am suddenly a bit worried about the fact they will have access to cash at 18; I want it to be for something sensible of course but I know what I was like at 18 and it would have disappeared on nothing much. Should I
A) Carry on investing in these and hope for the best in terms of their attitude at 18
B) stop where we are and save future money into accounts in our own name
C) carry on as we are and just take the money out and stick it elsewhere at 17 and a half leaving them 1k or so to have some fun with?

I can see that these ISAs are good as they've grown quite a bit since we started but I'm worried about them having money at 18.

You cant do option c. Its their money. You dont have to tell them about the account when they turn 18, out of sight out if mind

As far as I understand, the money is not accessible before the child turns 18. This means that, before then, it can be moved only to another junior ISA in the child's name. It cannot be moved to any bank account, let alone one in the parents' name!! So how you would transfer it and where at 17.5 I do not know. Yes, you transfer your kids' accounts, but only to other junior ISAs in their names - big difference.

Also, children can take control of the account when they turn 16. I'll admit I do not know if this means that, between 16 and 18, both parent and child can manage the account, or if the child theoretically has the option to tell the bank "disable my parents' access to my account".

I'll also admit I do not know the practicalities of what happens when children turn 18. Do the parents' login details stop working the day the child turns 18? Maybe some banks are sloppy, leave your access details working after the 18th birthday, meaning you might be able to move the money to a bank account in your name. But I highly doubt it would be legal.

@pallisers, that's true, however:
putting money in a junior ISA shelters it from inheritance tax and from your creditors. These points won't be relevant for everyone but will be for some, especially the latter - e.g. if you are a small business owner and run into financial difficulties.

Also, for some people it's irrelevant, but for others there will be a psychological effect from having money inaccessible, in a separate account, in someone else's name

@hellywell, even if you don't tell them, the bank will typically write to the child when they turn 16, ie when they can manage the money but not withdraw it. Unless you are proposing 'intercepting' your children's mail... Or 'posing' as your child by telling the bank your email is theirs. Neither of which will, I suspect, be very legal...

Absolutely not in their name.

Giving a large sum of money to 18 year olds is, in my view, crazy!

I have four accounts for ds. He has a child trust fund but his dad is the only one who can see what is in there and he refused to let me open it. There's a few hundred in and he will get that when he is 18. I have a kids regular saver and then an account that matures into. Both of these are in his name but he won't know about them until I feel he is ready. I then have a lot of shares in a company that are in my name but are earmarked for uni or a car or some other big ticket item that may be needed. He won't have access to this money as such but will benefit from it.

Oh dear!

In our name, ideally towards getting them on the property ladder if they go off the rails a fancy holiday for us 😂

I save for my DD in my own separate savings account which I’ve earmarked for her. I’ve invested any money she receives (Easter, Christmas and birthdays) in crypto-currency shares which has done very well so far.

My dad recently passed away and he has left her a very large sum of money (£300k!) so trying to work out how we can put it in trust until she reaches 25 because I really don’t want her having access to that kind of money.

Ds(15) has £30k in an ISA as the interest difference was significant when it was in his name. Around £10k of that was from small inheritances from 3 grandparents. He knows it is there and fingers crossed he uses it wisely as there will be no more!

Dniece had £15k when she turned 18, still has it now she is 22 and is adding to it for a house deposit.

My dad recently passed away and he has left her a very large sum of money (£300k!) so trying to work out how we can put it in trust until she reaches 25 because I really don’t want her having access to that kind of money.

unless the will specifies a trust to that age, I doubt you can. At 18 it is hers. All you can do is educate her so that at 18 she will be happy to put it into a long-term investment account. Our wills don't give our children access to anything but income/living expenses or disbursements at the discretion of trustees until about age 25.

My 16yo has £10k in an ISA they have no idea even exists. I don't plan to tell them about it any time soon. Is that an option?

We kept most of it in our name, just in case.

We told them at 18 that there is some money to help them with a house deposit but they need to help themselves first, by saving a decent amount themselves. They help themselves and only then we'll help them. Hopefully knowing this, will be extra motivation in today's climate when it would be easy for them to say what's the point as we'll never be able to afford a house.

We have savings for the children but only release when we think appropriate. Everything is in our names and will remain so until gifted. We would not have wanted them to have reduced drive and work ethic because money came too easily. Neither would we have funded indolence, drug habits nor subsidised inappropriate relationships.
Instead we’ve supported to buy houses, paid university costs, exam fees, paying for wedding, helped partners fly out when ours have been abroad etc.

I don't even have savings "for the children". I have savings for the family and since it is all money we earned I think we get a fair say in how we use it. Like CherryPavlova, we use it for education, cars if needed, (paying for wedding would be a bit of a gulp for me as I think big weddings are a waste of money but I would pay for a party), health insurance, general support.

My mother left me about 60k and I put that in a separate account to all other savings as I hope one day to give it to my children when they need it and say "this is from granny and grandad" (whom they adored). But that will be much later. My eldest is 22 and my youngest is 17.

Thank you everyone! I 100% get it that option c isn't possible ....

We kept most of it in our name, just in case.

This is the new plan. They have a few thousand each which will be theirs now. I will make strong suggestions for its use but can't do much about it now!

Future savings are going into accounts in our name earmarked for them for when they are deemed sensible whenever that may be.
We do not have loads of money - pretty average earners - but are trying very hard to save for our DC. My parents were irresponsible with money and weren't able to support me through uni or help me with anything as a young adult so it's important for me to be able to help them a little. Thanks for the helpful responses !

I’ve has this dilemma but for the moment we’re sticking with option A (mine are younger than yours. We’re saving a relatively small amount each month that is affordable to us. It might be something we review in a few years.

I think there is a real gap in the market (and legislation) for a savings product for children/young adults that can’t be accessed until 25. So many people have concerns about 18 year olds coming into money so young but want to save money to support their children with deposits.

on the back of this thread i have today liberated nearly 10k from 3 children's accounts.

I cannot work out where to put it now. I need to be able to differentiate between the 3 kids either through pots or 3 different accounts.
so so many accounts though, I dont know where to start.
I dont want to manage it through an app as I want it to be out of sight somewhat.
but not a totally obsure unknown account.

any suggestions?

I’ve put a measly sum in my name. I am not sure if I’d ever need the money myself if in a tight spot. That maybe different if you’ve paid off mortgage, got a great pension savings etc.

And obviously will they just spend it on drugs and clubbing abroad. I’ve known of a few people who blew loads of cash at a young age and it never did them any favours...

I'm with squirrel too. We are within all the tax allowances so I don't think it makes sense to restrict what happens to the money in the future. We save in our own name and if we have enough when the kids are older, we will give them money.

They do have Junior ISAs because their grandparents give us money specifically to put away for them so I we wouldn't take that for ourselves.

I'm relaxed about that. I have explained the implications of Junior ISAs to GPs. If they are happy with that, I am happy.

I think making mistakes while young is part of growing up. If they want to blow £20k of Grandad's money at 18, that will be a lesson for them.

Almost all in their names now. I moved them out of my sub accounts in case I'm moved to universal credit. I often panic in case they spend it on booze/ drugs/crap when they hit 18. But if it sits within my accounts I'll be penalised for it. I'd prefer I could keep it safe until they leave uni.

I have a junior stocks and shares isa which has a few hundred pounds and premium bonds which has 5k.

Thinking back to when I got given my premium bonds - I blew the lot within a few months just on living expenses

I'm now thinking maybe I save for myself and pass on any money I think needed for uni and house deposits

I save monthly for my DTs in to an account in our name. I worry about how responsible they’ll be when they reach 18, and also if something happens between now and then and we need the money to keep the house etc.

I’m thinking when I go back to work of opening an account in their names and adding a small amount monthly so they can have some fun with it, but it won’t be a huge amount if they do piss it up the wall, and we’ll have the main savings for sensible adult things for them as a back up.

I have savings of my own. DD will have access to money when she wants to buy a home. Other than that she will not have access to it.

I will buy her first car, and I will make relevant contributions if she attends university. The savings plus board I take from her when shes old enough to work, will go together, will hopefully be a deposit on a home, or part of depending on how much house prices skyrocket!

I will make her life as easy as I can, along as I see her striving to make a decent life for herself.

Do the parents' login details stop working the day the child turns 18?

Yep! The kids get letters as they approach 18, parents logins disabled on birthday and child sets up his/her own.

I have had 2 go through this, they also have a significant inheritance that came to them at 18. As aa pp said, unless the will states an age, they get it at 18. Can’t stop that, if so they could sue you.

Both are drip feeding it into their ISAs and are fairly sensible, although we are trying to stop DD frittering money from her gap year job. She has saved well to go volunteering/travelling but knowing she has that large buffer behind her is not helping with the frittering!

To those saving in their own name but for use by DC eventually - just think about what would happen if you divorced (it would be part of settlement), you die and partner re-marries (it could all go to second spouse) and other such eventualities eg you become ill or redundant and need benefits - the money would be counted as yours.