Dc getting money at 18

[Flickoffboris]

My dc are young but I'm thinking about setting up some savings for them, probably an ISA.

My concern is that they'll automatically get access to it at 18, and they may be absolute angels, or they may be complete idiots who'd spend it on Ibiza, drugs and partying (as I would have done ).

Short of intercepting any letters and not telling them about the money, is there any way to prevent them getting their grubby mits on it at 18? There doesn't seem to be an option to transfer it back to my name just before, or lock it til their 21 or whatever.

Are you in a similar position, what are you planning to do?

@absolutelyknackeredcow

We have 2 dcs and due to saving monthly from birth, an inheritance and my father ( their grandfather) actively managing the fund they will have upwards to 70k each at 18. They have way more savings than us. It's their uni fund - we have only talked it about it as such since they were little. They can have debt forever or use it wisely. We plan a drip drip approach around financial management as they get older followed by a robust chat when they turn 18 and he'll transferring it to long interest accounts. That said - a reasonably big splurge of 1k or so is going to be encouraged to get it out of system. We have to hope this works - no idea if it will

I would read very carefully into this (MSE) before wasting all that money on uni. For many reasons (career choice, SAHM / PT work) your DC might pay back little or none of their fees. See it as a tax on future earnings (which you can’t predict). I haven’t paid back any of my student debt as I taught a certain subject and then became a SAHP for a decade. I think the debt is written off soon.

That money will come in very handy for a house deposit though!

We had this concern over the Child Trust Fund and so invested the original cheque of £250(?) and left it at that. Ds is almost 18 and it was about £1000 on the last statement.

We had friends sneering at us about not paying into it, we told them we were saving money but in a separate account because you need to know the personality of a teen before you hand over a wodge of money to them. Ds is sensible, his mate is completely influenced by brands and designer brands so he has already seen what he will spend his CTF money on which is basically "cool" clothing and bags.

Ds has a few thousand in a child's saving account for him. We then saved separately to fund the means tested "parental contribution" portion to make up the maintenance loan for university which will cost us £5k per year for 6 years as we have 2 children 3 years apart. That £30k is in premium bonds and in my name. We have other premium bonds in Dh's name for other savings.

I would maybe look at something small that they can access at 18 but also save to fund the parental contribution (they reduce the amount of maintenance loan the student can apply for based on family income, so for Ds it is less than half, we have to stump up the rest. His £4k doesn't even cover his accommodation which is £6k) or if they don't go to uni toward a house deposit as that is probably the thing they will struggle with most.

We have investments for our children in their own names, around £40k each currently, which they don't know about. Their older siblings did know about theirs but when they got to 18 they didn't want to spend it as they were waiting to use it to go toward property deposits (which they've now done).

My DS received an inheritance from my dad when he was 14. When he was 18 and just about to start thinking about Uni we had a chat with him about his money and the best way forward. He ended up putting his money into a deposit in a BTL flat. It is just a one bed flat near the centre of town which has luckily had the same, reliable tenant for the last 2 years. My DH had to be named on the mortgage but he has no financial interest in the flat and we had this written up by a solicitor.

With the money DS gets for the flat; after taking out the mortgage etc it pays for his living costs whilst at Uni so he has only had to take out a tuition loan.

He has the option going forward of living in the flat himself or selling it later, hopefully at a profit, but he now has his foot on the property ladder.

Premium bonds aren't useless. I've won almost £2k in 18 months on much less than max holdings. It bucks the trend yes. But the money is easily accessible and not for locking away long term anyway.

I think it's a good idea to start financial education young! DS is 19 now and has considerable savings but having got himself a job at 16 and saved the money he has learned to manage money sensibly. He has also had an allowance paid into his current account since the age of 16 and had to learn to budget for lunches, toiletries, some clothes. When he turned 18 we turned over his savings to him, he put 3/4 of it into a fixed bond so he can't access it but still has a few thousand he can spend to top up his student allowance. Early discussions about money have paid off and he lives within his means

I think for more average earners (who haven’t maxed their own ISA and pension contributions) it rarely makes sense to save in a child’s name.
Too much risk of them (a) blowing it or (b) not appreciating the value of money because even if not blown it just dropped into their teenage lap.

The only good reason in my view, is to get a child thinking about saving and encouraging it by letting them see that a small amount makes a difference, and savings can grow. But I’d rather teach that lesson with £5K than £50K.

Have some in junior Isas but not huge amount my own child is quite a way off 18 so we can get long term gains from stock market. I am saving in own name in own isas and therefore can decide if I want to help further at that point. I don’t agree with giving young people too much and inheritance seems to always come with emotional strings.

DH and I only save in our names for this reason, although I have a bare trust in my name with the child's initials for each child, which my father has put money into and which contains investments that he has selected. I don't have to transfer this to the child's name at any particular age and in fact they don't know about it at the moment.

We save for our DS in 2 JISAs ,1 cash and 1 Stock & Shares . We made it VERY CLEAR to him that this money is to be used ONLY for a house deposit.

I've got a stocks and shares ISA in my own name which is for my daughter's university education (assuming she wants to go). She also has a stocks and shares JISA in her name which I put £25 a month into. This is a gap year/car fund that she can have at 18.