Do you save for your children's future?

[GreenTiles22]

Inspired by other threads, if you have any disposable income, do you put any into an account specifically for your children? Such as a trust fund or savings account?

I don't.

We have 2 healthy incomes, but also high outgoings - 2 new cars (leased, monthly payments), 30 year mortgage of £400k, 2 preschool kids with childcare costs each, usually 3 holidays abroad per year. We are fortunate to put savings aside and overpay our mortgage a bit each month. But I don't save for the kids. I figured that when they are older, we will assess our financial situation and gift them a sum of money when they are 21. We use most of our spare income to either build our savings or pay off the mortgage, which I thought would leave us in a healthy financial position in 15/20 years to gift any money.

What do others do?

I think what underlies the much of the MSE expert stuff is the assumption that people will spend all the money they have unless they hide it away from themselves. Whereas I don't think it mattesr how much a month you transfer to a specified savings account for a specfied purpose, it is your income and expenses that determine how much money you have.

I assume that's aimed at me, as I was the one who posted the MSE link. I don't think that's the underlying assumption at all! It's very clear from the page that I shared that many parents are unaware that they are expected to contribute to their child's maintenance costs at university, and that these can be sizeable. Unless you're very wealthy (and it sounds as if the OP is), you're not going to be able to meet that sort of demand at short notice - you'll need to have saved up. The calculator allows you find out how much you'll need to save to cover those costs - in our case, it's a couple of hundred pounds a month, so more than we might be saving for that purpose otherwise.

I agree that your income and expenses determine how much money you have, but I also think that some of those expenses are discretionary, and that you might decide to forgo them (e.g. 3 foreign holidays a year, or new cars on finance) if there's something big that you need to save for. DH and I are quite financially prudent, and do save money every month, but we plan how much we save so we know we're not spending money that we should be saving (or vice versa - it's a shame to save money without an end in mind if you could be living a more enjoyable life now ).

Oh, and saving to pay for university maintenance costs is completely different from saving for your child to have a "nest egg" when they're 18! The first is saving to meet your financial obligations - the government considers that an 18yo in full-time education is their parent's financial responsibility and that you will step up and pay any shortfall in their maintenance loan. This (to me) seems quite different from saving for your child to have their own pot of money, to do with as they will.

I actually think that it's up to the child if they want to blow all their savings on cassettes - to me, it seems a bit controlling to claim that this is the child's money but then insist that they only use it for "approved" things. If you want to save up so you can help them out later on, that's fine - but that's your money, not the child's. This seems to be an unpopular view, though!

Yes we have Isa’s and pensions for both. New one will get the same. My parents did it for me so it seemed like the natural thing to do.

I had no idea you could save for a child's pension - that is something I will definitely look into.

I checked the MSE link re uni fees and see a lot has changed since I went to uni!

I'd happily give them £1,000 and they can learn how to grow it (or blow it - their choice!) but I'd feel uncomfortable gifting them much more that they hadn't earned themselves. However I would probably be Willing to help with a deposit for a property, but from my own savings.

I guess I just don't see the value in giving young adults a large cash gift that they haven't earned themselves. .

Greentiles I know, the cost of student accommodation is scandalous compared to when I was at University!

I think the rest of your post actually sounds really sensible, and if you're not planning to give them large amounts of money (which sounds perfectly reasonable!) then there's probably no rush to save specifically for them rather than for your own general savings. The main reason I've been thinking about increasing how much we save is that university is now only 8 years away for DC1 and it's a lot of money to find without preparing for it! I'm more relaxed about house deposits as that is hopefully going to be a lot further down the line!

Yes, My DC are now teens but we have saved £100 pcm mostly from birth, initially in CTF's then transferred when it was allowed to JISAs and invested in stocks & shares throughout. We didn't do this at the detriment of our own personal savings/investments though and have paid far more in our own pension contributions and mortgage overpayments. (Mortgage technically paid off 5 yrs ago!)

DC1 will be starting uni in 2 yrs. Currently, his JISA has more than enough to fund him through his studies and possibly even a house deposit so there's no pressure from us to fund him from current income - which was the whole point of it all. Ditto for DC2 a few years younger. DC1 knows that it's not a pot of cash just handed to him at 18 and that the aim is to live off the income for the duration of his studies and preserve the capital for a house deposit/future business/whatever. At the moment, he's fine with me managing it going forward and giving him advice regarding what to buy/sell when he needs it. There is no parenting crystal ball but I certainly didn't waste my childhood savings of £8K back in the day when I got access to it at 18.

We are currently saving £500 a month for our 2. Aiming to have enough for good deposits on flats when they go to uni.

Yes, my dd will get around 10k when she's 18. I'm hoping she'll be sensible with it and not 'piss it up against a wall'

No, we spent the extra money we have on them now.
Violin and music tuition, art classes, sports clubs, taking them abroad to learn about other cities and cultures. We feel it will make them more rounded than giving them a lump sum one day.

We've got savings accounts (2 accounts each, one high-interest & one lower-interest) & premium bonds accounts.
We pay in every month to the high-interest account, it matures once a year & moves it into a lower interest account.
Birthday/Christmas money gets put into Premium Bonds.
We're considering both a JISA or pension for them both too.

Na - I’m spending the money on them now too ! Lots of travel / festivals / fun stuff

After this year with being stuck at home made me realise even more how short life is - so should enjoy it while we can! Sure what if I saved all
My spare cash for uni and we are all dead because we fucked the planet up - or another pandemic comes along in a few years!

We are going to move back to our home country eventually anyway though and university is free so maybe not as important for us to save for as people in the U.K.!

When we had two incomes I saved regularly for the children (or child, we only had one at the time). Then I stopped work to be a SAHM while the children are small - we don’t regularly save for them at the moment but I do put any money they are given into premium bonds.
We do save a bit each month, and this goes into a general family savings account.
Once I’m back at work I’ll re-start saving for them each month.

i save £40 a month for the dc. £20 each split over 2 accounts. one account they will be able to access when they are 12, with me as joint signatory. the other account not until they are 18. all birthday and christmas money they get so far gets chucked in there.

i also tend to use gift vouchers they get for myself (dc and 3 and 18m) and then put the equivalent value in their accounts. so they get the money, just not the voucher.

Yes, we save a good amount into an account in LO name. It's important that we save for our children's future I don't know why you wouldn't if you can afford to.

We opened a junior savings account in DD’s name when she was born. Any money she gets goes in there, plus if we get any overtime or sometimes money gifted for our own birthdays/Christmas we’ve put it in there for her. Once I’m back to work I’ll probably do 50 a month and do it via standing order so I don’t miss it.

We will be keeping it though for a house deposit for her though, she won’t be gifted it at 18/21 to just do what she wants with it. I’d be devastated if it just got wasted. Where we live the flat/house prices are ridiculous and that’s before you even factor in fees/stamp duty etc etc. We couldn’t have bought without help from both sets of parents, despite saving hard and having good jobs, so I’d like to start putting something away now for when she’s older so it’s already saved.

Yes, but in my name. I have savings that are specifically to help the DC with the deposit on a property. They do have savings in their own names but just where birthday/Christmas money gets saved so I don't mind if they blow that.

From the perspective of a child, when I was born a building society acc was opened for me (good interest back in the day). I was always gifted £100 from grandparents birthday and Xmas as well as sometimes other money from family. I would get a few presents probably from DM and she says I was always happy so the money always put into my building society. By about 18ish I had about £15k and was a deposit on my first flat when I was 24yrs old. I'm so grateful my family did this. Particularly as I have cousins who got the same and their parents always took them shopping/spent it probably on pointless Lego crap that was used a week then charity shop.

Yes, we have a household income of £70k ish. We put £100 per month in Junior ISAs for each dc. We have done this since they were born.

£10 per month per child (2 children). We've only just increased this in the past week from £5 per month as I got a tiny pay increase.

Its such a tiny amount, but neither myself or my partner had any type of savings account when we were younger and I would like to be able to give them something no matter how small. Any spare birthday money goes in the accounts as well and we do hope to increase contributions but we have so many other things to save for (our wedding, new bathroom, boiler etc) that most of our savings go into those pots.

A little bit each month, but into a savings account in my name. They have a grand each in an ISA too but I stopped adding to that when I realised they would have access so young and could spend it on whatever. I'd like it to be used for driving lessons or a RTW trip, but of course it's up to them - i'd be disappointed if they spent it on what I consider to be shit, so am saving anything else in my name to be able to help them in the future.

I have a standing order of 10 quid a week going into my dc account. Been doing this since they were born and plan to give it to them as their 18th bday present so they can either gonon their J1 to America, buy a car or both before they start Uni in the Sept. Birthday is in May.

No. I'm still saving for myself and haven't got a house deposit together yet, a safe home for us all to live in is a priority and getting a pension saved for myself so I won't need to depend on them when I'm old. I have a huge student loan I'm unlikely to ever pay off I assumed my kids would do the same if they go to university (which I won't be encouraging). I think it's important for kids to learn to save for themselves and get into a good work ethic. I got a part-time job at 16 after college and it's helped me get jobs ever since, it was a great introduction to work. I would share any money I save with them as adults if they really needed it though, and they could always come back to the family home if they needed to. I think a good attitude to money and earning it themselves is more important.

we save 30 pounds per month for each of our DC into stocks and shares ISAs which are performing well. We also put birthday/xmas money in or any little gifts or windfalls. This is for them to have when theyre 18 and would be no more than 8-10k (just in case they piss it up the wall - not impossible is it!)
Otherwise we just intend to use our own savings/income to support them through their higher education and perhaps onto the housing ladder if it will stretch that far. I don't feel comfortable saving any more than that in their names.

Yes I save a small amount (about £10) every month per child and my mum puts the same in their accounts too. They know they have an account but not how much is in it. I haven’t thought too much about what the money is for or when they’ll get it.