Premium bonds question!

[whiterabbity]

Is there any benefit in having a child’s premium bonds account as opposed to the parent having it and giving it to them when they need the money as an adults? For example, if I open up a premium bonds account and pay into it every month under my name and then give it to dc when they need money as an adult for uni or a car or whatever, is that any less beneficial for putting it in DC’s name for when they’re 16?

There's a maximum limit of £50k per person so people often open one per family member so it allows each person to have £50k (if you have that kind of money-not me!). If you're not near the limit then one account in the adults name is easier to manage unless you want your child to be able to access theirs freely or to ring fence it as theirs for some reason.

Is it likely that your estate would be subject to IHT if you die?

Perfect, thank you @ConflictofInterest! No, unless it wins anything it’ll have about 15k in it by the time she’s 18 😅 I’d also like to be able to control when it can be used as I think it said at 16 it gets transferred to the child- I know what I’d have done with that at 16!

@GoldenBoldorno, nowhere near

You would be much better putting the money in either stocks and shares or normal cash savings where you will get a decent return. With the amount that your are talking it is not likely that you will.win much. Even a normal cash savings account will give you guaranteed interest to boost the pot.
If in stocks and shares it could grow considerably over a decade or more.

Another good reason for keeping it in your name, is if you have more than one child, if one were to get a big win, it would seem unfair. If it is in your name, then any winnings are still in your control.

If you are married abd divorce some time in the future, OB in your name woukd be 50% yoyr spouse's.

That’s fine @ByQuaintAzureWasp, I’m not planning on it but it was DH’s idea anyway ☺️

That’s exactly what I thought @Choccyp1g, thanks ☺️

Child savings accounts generally pay a better rate of interest
Children pay zero tax on their savings (until 18)

Premium bonds pay the same rate for everyone
All prizes are tax free

You can get better rates than Premium Bonds with child ISAs

Child rates over 5% are excellent

https://becleverwithyourcash.com/saving-for-children-the-best-accounts/

1 July 2004

The Premium Bonds customer with just £17 invested

A new record in the history of Premium Bonds has been set as
a Bond bought more than 45 years ago in February 1959 has
won the £1 million jackpot for a mystery winner in
the London Borough of Newham.

Not only is it the smallest value Bond ever to win the £1 million
jackpot, it is also the oldest Bond to net the top prize,
debunking the myth that old Premium Bonds never win prizes.

A person can have 1 Premium bond for 50 years & win nothing

A person can have 1 Premium bond for 50 years & win 1 mlion

The monthly draw is random

All prizes are tax free

to - 3IcePOPdays · 23/08/2025 12:01

All prizes are tax free ............. you think ?

HM Treasury and NS&i make sure a small amount of CONTRIBUTION
to the benefit of the Taxpayer is allowed for in the Prize Fund interest rate