Savings account until my son turns 21

[Deleted member 18121]

Hi all

My little boy is 18 months old and the Mrs and I want to setup a savings account to stick £100 per month in until he turns 21.

Does anyone have any experience on this kind of setup?

We were ideally looking at a tax free wrapper (ie an ISA) but it seems that when the child turns 16 they become the owner of the ISA, so we were wondering about a basic savings account or maybe premium bonds.....

Any suggestions are welcome, not looking for advice of any sort....just suggestions of possible options.

Cheers all

Adam

 

[richart]

You are potentially investing roughly £24,000 that could hopefully be worth considerably more after 20 years I would get some advice rather than suggestions on here.:thup:

 

[londonlewis]

I'll be interested in your research on this adam6177.

Me and the wife have just set up a bank account for our 6 month old daughter. We are putting in £20 per month from the month she is born until she is 21. This will be £5k when she turns 21.

At the moment we have purely gone for a saver account with our bank although I appreciate that £5k in 2035 will not be a lot of cash.

 

[Fromtherough]

It is a bit of a minefield. It is worth considering if they will want access to the funds in account (for whatever reason) before they are 18/21 years old. Some ISA's and other accounts bar withdrawals before a certain period. It is also worth finding out if there are limitations in certain savings accounts as to how much you can actually invest (both in total and per month). Although these are usually at least £150 per month, if you add birthday/xmas/christenings money into the mix then it is difficult to save all in one place. For this reason we opened 3 different accounts for my now 21 month old daughter; An ISA, a normal savings account and an account with a building society which offers slightly less Net interest but offers a bonus if you make no more than 2 withdrawals per year (not that we have).

 

[richart]

It is a bit of a minefield. It is worth considering if they will want access to the funds in account (for whatever reason) before they are 18/21 years old. Some ISA's and other accounts bar withdrawals before a certain period. It is also worth finding out if there are limitations in certain savings accounts as to how much you can actually invest (both in total and per month). Although these are usually at least £150 per month, if you add birthday/xmas/christenings money into the mix then it is difficult to save all in one place. For this reason we opened 3 different accounts for my now 21 month old daughter; An ISA, a normal savings account and an account with a building society which offers slightly less Net interest but offers a bonus if you make no more than 2 withdrawals per year (not that we have).

Remember you can invest the contributions in equity based funds and not just Cash. Over the long term theses may do better. I have arranged a lot of savings plans for children, and they have been some of the best investments, as they are long term, and monies tend not to be withdrawn. in the shorter term. Hence the reason for advice.