advise needed for account for dd1.

[misdee]

dd2 and #3 will be getting £500 start up from the child trust fund. as dd1 is older she wotn get a penny. want to set up an account for her as well, with a start up amount of £500, which she can access when she is 18. want to be able to pay into it throughout the year, but probably only upto £1200 to keep it in line with the other accounts.

so what do i do? too many out there for me to get my head around.

Try this site from The Motley Fool website. They have a dedicated discussion section on investing for children, as well.

But I believe the consensus is: for small, irregular amounts (eg. birthday money) pay into a child savings account (Nationwide scores consistently well on its interest rates for kids' accounts). When it gets to about £500, transfer it into a UK-based index tracker, such as M&G uk tracker. M&G (and others, I'm sure) will accept quite low monthly payments, starting at £20, I believe.

This is what I do for my kids, FWIW.

ps have got those nappies bagged up for you, but don't get round to much atm. Will email you and try to send them off after the w/e.

i'm gonna try and get the £500 together so when the vouchers for the other accounts come thro its there to be ready to set up iyswim.

They have savings accounts which i pay £2 a week in for them, not much but means they can use that for things they want once a year sorta thing, holidays etc. and was thinking about £20 a month going into each account.

what is a tracker? i'm completely dense when it comes to accounts. as far as i'm concerned, money goes in, money goes out lol.

A tracker is a share-based investment. Buying individual shares in big companies would be v. expensive, and would also be risky if you didn't have enough money to buy at least 10-15 different ones, since one individual company could go belly-up, taking all your money with it.

With a tracker, you buy a little bit of everything that's in the index, either the FTSE-100 (the 100 biggest companies in the UK) or the FTSE-all share (all the companies listed on the London Stock exchange), so the value of your investment will follow the value of the index that you've bought into.

The principle behind this is that over a long period of time (10+ years) there is a strong likelihood that shares will increase in value faster than cash sitting in a savings account (but no guarantee, obviously).

I would really recommend pootling about on the Motley Fool website for a bit, if you want to know more they have good basic guides, and lots of very knowledgeable people posting on their boards they're generally pretty kind to posters asking basic questions, too.