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Best way to invest money for new baby. Junior ISAs, etc

Discussion in 'Children and Family' started by db, Oct 22, 2015.

  1. db

    db #chaplife

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    so, i have a new toy to play with in the form of a teeny tiny baby girl.. being a grown up, i want to do the grown up thing and put some money aside for her every month.. what's the best way to do this?

    i thought it would be a simple case of opening a junior ISA, but there are so many options and caveats out there that my mind is a bit boggled..

    on advice from my dear ol' dad, i looked into investing in stocks & shares.. since i know nothing about either, i chose what looked like a simple yet good option: a My Select Junior ISA from Scottish Friendly.. the idea seems to be, you whack £20 a month or whatever into this account, they invest it in something, and hopefully over the course of 18 years or whatever you'll be the next gordon gekko.. having just had a quick google, however, i'm worried i've made a heinous error - scottish friendly seem to have quite a few unhappy reports out there, their My Select plans in particular..

    i'm assuming others have looked into this for their little 'uns.. i'd love to hear what conclusions you came to, and how you chose to save in the end..

    thanks :rich:
     
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  3. kyoto49

    kyoto49 Well-Known Forumite

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    I'm no expert, but I did the Scottish Friendly thing. Paid £20 a month for 10 years and got a few thousand back. It's certainly a few thousand more than DD would have had if it had been up to me to save for her every month, but I have no idea if it was the best way to save, if there is such a thing. I liked the fact that the direct debit went out every month and I never noticed it and 10 years later she had thousands!!!
     
  4. Gramaisc

    Gramaisc Forum O. G.

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    All of these things are gambling, as is not doing anything.

    I had what is now called a Family Bond with these people, it worked fairly well.

    People who have had a bad past rarely get much better, but people who have had a good past could find that the people that caused this have all used that evidence to move on elsewhere - you will never have the information to make a truly informed choice.


    You can only gamble to the best of your ability.
     
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  5. My Name is URL

    My Name is URL Well-Known Forumite

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    I stick my little'uns £80 a month Child Benefit, rounded up to £100, in a Halifax Regular Saver which pays 3%.

    Then every year when it matures I stick it in a Halifax Junior ISA, again 3% and the regular saver starts all over again.
     
  6. db

    db #chaplife

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    christ, you're magnanimous - i spend our child benefit on pies and booze!

    their website looks good - lots of info on how it works, projected figures with fancy sliders, various awards.. and to be honest a personal tip of the hat from you is about as safe a recommendation a place can get imo, so i'll defo be checking this out - thanks :up:
     
  7. Gramaisc

    Gramaisc Forum O. G.

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    Tell them to ask TalkTalk for my account details and they can just squirt my commission straight in.
     
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  8. db

    db #chaplife

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    oh, i ended up cancelling this account incidentally.. there are some really scathing reviews of them dotted across the internet, so i thought i'd get out before i'd invested any money..

    a few sites (including money saving expert) point towards this site for advice, so i think i'll have to have a read here: http://monevator.com/how-to-invest-for-children/
     
  9. Goldilox

    Goldilox How do I edit this?

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    I opened a Halifax regular saver for our little one - you put money in every month & it pays 6% interest. It's limited to a maximum of £100 a month & after 12 months the balance automatically transfers out to their standard junior savings account (which pays at 3%). It's a bit complicated, but basically you get 6% on this year's savings & 3% on everything you've previously put away.

    I wanted to put the money somewhere where he could get at it if he was desperate to go on the school skiing trip, as opposed to an ISA he wouldn't be able to access until he was 18.
     
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  10. Gramaisc

    Gramaisc Forum O. G.

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    Skiing? Can he actually walk yet?
     
  11. Goldilox

    Goldilox How do I edit this?

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    He's very nearly managing it.

    The skiing trip was just an example - it could be a history visit to the pyramids, or an exchange to the US, or whatever. Nothing in the immediate future, but stuff that's likely to come up before he turns 18.

    Also surely the benefit of an ISA is the tax free status, which makes not a jot of difference to someone who's under 18 & earning less than £8000 a year?
     
  12. Gramaisc

    Gramaisc Forum O. G.

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    It's nearly November...

    [​IMG]

    Skiing down the Pyramids might not be allowed.
     
  13. db

    db #chaplife

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    well, exactly, and if i go with a junior ISA then little madame has full charge of the account and can do whatever she pleases once she hits 18, and i am powerless to stop her.. so if she's a typical 18 year old, she will almost immediately spunk it up the wall on drugs and booze..

    i'm starting to think it might be a wiser choice to have a secret savings account, that i only let her know about once i am happy she is mature enough to decide what to do with it, or as you say she has some dire financial need.. is there a way i can do this, and if so what is the best way?
     
  14. Wormella

    Wormella Well-Known Forumite

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    I should point out this is also mainly made up of Child benefit, as above , I live in fear that some kind government official will change the threshold one day and I'll no longer get it, so I darn't rely on it. Since it has to get paid to a grown up we had a spare savings account it gets paid into, and we can also pay any birthday / christmas money in and use for him without messing up the Halifax accounts.

    It also never occurred to me not to trust him with whatever money is there for him.
     
  15. Gramaisc

    Gramaisc Forum O. G.

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    Probably only a couple of months before you find him indulging in cake.

    [​IMG]
     
  16. My Name is URL

    My Name is URL Well-Known Forumite

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    Just FYI, the Young saver is now 2.25%, not 3%.....

    The ISA is 4%. AFAIUI you can withdraw from the ISA at any time though so just as easy to use for the skiing trip....
     
  17. Goldilox

    Goldilox How do I edit this?

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    I'm pretty sure they should have written to me to tell me if the rate was changing, but OK, point taken.

    FYI:
    I looked at enough different ones to get the impression that is a standard clause on all of them... I assumed it was government imposed after they used the junior ISA to replace the child trust fund. Also it only pays 4% if I move my savings into a Halifax ISA too - if I don't it pays 3%.
     
  18. My Name is URL

    My Name is URL Well-Known Forumite

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    I did wonder if that was only for new customers, or perhaps a recent change and they haven't written to you yet... anyway, no matter.

    Good spot on the "no withdrawals" thing, I never spotted that but not bothered because I won't be touching it anyway. You can transfer to other Child ISA's though if the rate drops.

    You are right about the 4%, all I did was opened an ISA, stuck £1 in it and that got me the higher rate on my daughters account. Not great if you use your ISA allowance but to be honest my Santander 123 current account pays a better rate than any ISA anyway so I just stick all my savings in there.
     
    Last edited: Oct 25, 2015

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