Children’s’ savings - in their name or ours?

[PyjamasToMyLeft]

We have about £10k saved so far for each of our two DC. We need to find an account with a better interest rate. But I’m wondering whether to put it in their names (as currently) or ours.

DH’s nephew got access to his savings at 16 and just drank it away. His single parent mother had scrimped to save for him, such a disrespectful waste. I’d like to think mine wouldn’t do that but who knows. Mine are currently 12 and 13.

Tax could be a factor but I don’t have an ISA at the moment.

I’d rather have some element of control over what it’s used for - for driving lessons, uni living costs, or later towards house deposit if we can afford to support them through uni at the time.

On that basis I think it’s better in our names?

In your name or in trust if you can.

We have a goodly sum in DSs child trust fund - enough to cover board and lodgings through university. But if we are forced to give the lump sum to him aged 18, there's zero way that will happen as he is a spend thrift - as many of us are at that age.

It actually makes me so angry at a system that could allow him fritter away a sizeable sum that we saved and invested wisely for him and as we would like to retire at 60, we're not in a position to be handing out more money if he does.

We have talked about putting it into a separate account and dosing it out on a monthly basis, but of course if he changes his mind, it's his money . Friend is in a worse situation as her adult DD has some mental health issues and would definitely spend it all when on a high. She has had to hide the funds from her DD.

If I was doing it again I'd put the money in an ISA in our name, never mind the additional tax benefits we would miss.

I'd put the money with the amount you're comfortable with them having at 16/18 in their name to transfer automatically, which for me would be any money I already told them was theirs at minimum, and if you want to save more earmarked for them for certain things, save it separately in your name, but I wouldn't bring those funds up until it became relevant.

I've seen a lot of bad blood started because parents promised money at adulthood or certain events and then either couldn't keep that promise because of circumstances and/or the strings attached (and often added) caused friction.

There is a lot of time to develop between 12 & 13 and 18. My 18 year old certainly hasn't acted as he did at 13 when he was eager for any geeky goods he could get his hands on - he hasn't touched his, only he can move it and it hasn't transferred yet. We always discussed it as a 'starter fund' when we showed him the annual statement each year and so he's treating it as a 'when I move out' fund, which isn't in the foreseeable future, with him going into an apprenticeship in autumn and not looking at all into uni or cars.

Agree, keep in your name. What we want at 16 or 18 is very different to what we need at 25.

Opps, pressed 'post' too soon. I meant to say this ^

My kids have 3 different funds. Each has a savings account paid in to by in laws which is about £5k for eldest. We also paid £100 every month into CTF for them both which is now a sizeable amount but I'm hoping they'll use this for uni if they decide to go as we can no longer support them to do this (divorced and ex lost his well paid job) and another sum in a trust which they can't access until mid 20s. The benefit of all being in their name, it isn't part of our assets on divorce and they'll still have this. I think it's important them to learn responsibility for money. If they're going to uni at 18, they need to learn about budgeting. I expect some pissing it away (though more likely gaming it away), but I'm hoping to guide them towards driving lessons etc and the trust will hopefully be a house deposit. I might be delusional but we'll see!

I have accounts that I manage online . No mail to the house. You have to check that they don’t send annual statements or ( if it’s a building society ) invitations to vote at the AGM, as they might be addressed to the child.

Their name, they will be adults. Mine got their money at 18 and used it sensibly.

Mine is in their name but they don't know about it and I'm not going to tell them

Put half into a junior SIPP and half into a S&S JISA. The half that is in the SIPP cannot be accessed until they are at least 57 so that is relatively safe from frittering and with the JISA, having to sell the funds and then transfer the money to the bank account should curb any impulse spending.

Will just add for those hoping their DC will be sensible, it’s really impossible to tell. The one whom I thought would be a spendthrift has saved appropriately and added to the pit. The one who I thought would be sensible was absolutely not!

We have both. Money from relatives is in their name and the money we save for them is in ours. I'm hoping they'll be sensible, but impossible to tell!

Can people who are putting money into trust share how they did that? My impression was it was a complicated and expensive route which created big tax issues.

Not sure it follows that because yours did the op's will !! Why risk it?

@calyxx I have trusts for estate planning. My IFA advised on the structure for tax purposes and then a solicitor drafted the trust documents.

My IFA provided the service free and solicitor about £3k to draft and witness if I recall. The management fees work out at about 2% or thereabouts.

for my personal circumstances it didn’t really become cost effective until I had fairly substantial assets.

In our name. Apart from Premium Bonds which were set up for DC by my mum.

Once they're old enough/able to pay us rent (working on the assumption here that DCs generation will be living at home until mid 20s) we also aim to put that away for them in secret.

I'd love for them not to have to rent as DH and I did for many years and it's a difficult cycle to escape.

Going against the grain, not only does our child have money in their own name, but they also know about it.

She has had her own bank account since she was 12 and gets pocket money by a standing order - and manages this very well.

She also knows we have been saving in a child trust fund since she was born and this money becomes hers at 18.

We've been very clear that we won't be contributing towards university or training because that is what the fund is for.

I have money in a normal children’s savings account with a building society. They are held in trust for them until 21. It cost nothing.

It’s not a trust that is set up with the children as beneficiaries.