Savings Accounts for Children
I have a confession to make, as Dave Grohl sang…my boys do not have savings accounts. There you go I have said it out loud, or rather written it on the internet for the world to see. I have a story of course.
When they were little I did so well!
Back in 2007 when Dylan was born and 2009 when Josh was born I had a stable well-paying job. Savings accounts were set up and payments were made into each account regularly. I paid in quite a bit, maybe £100 each month. Every time they got money as a birthday or Christmas present it went into these accounts as well.
Jack came along in 2012 and well, I never got around to setting up his account. Shortly after Jack arrived (3 children thus needing more room) we extended our house. I’ll be the first to admit that we got carried away with the extension. We didn’t just do the extension and make that new bit of the house look nice we ended up doing the whole house, from new windows to the garden to carpets and flooring. It ended up costing quite a bit of money, more than we had taken out of the mortgage.
Savings Accounts for Children Raided
Consequentially the children’s savings accounts were raided and invested into the extension. It was for them after all, a bigger house with a bedroom each. We justified it.
It’s now 3 years on from the completion of the extension and we never did re-open those savings accounts again.
Birthday & Christmas Money
The boys are very lucky to get money birthday and Christmas presents from a few family members. They transfer the money straight into my bank account. I really try to use this money on something useful for the boys, be that new football boots, clothes or remote control cars as Dylan chose this Christmas. But it sometimes seems a waste when it could go into an account and be squirrelled away for the future.
Doing something different – Kingston Unity
I have decided that this year I am going to do something different. I want to have some money set aside for when the boys reach 18. A great way to do this is open a friends and family junior ISA.
Money can be paid in regularly or as one off payments by anyone that you give the unique link to. Once it’s paid in it cannot be withdrawn until the child is 18. Kingston Unity provide an account of this type. It was simple to set my account up and to set up payments which can be done as easily as adding your card details.
A nice touch is the ability to put money into specific pots for your child, maybe a house deposit or car. The relative paying money in can also leave a message which the child can read as the year’s progress. You can also set up a message from your child that will go to the giver of the money to say thank you.
The money is invested into a mixture of shares, property and fixed income product, there is small annual management fee taken from your balance and returns. If you already have a child trust fund or ISA that can be transferred into this account as you cannot have more than one per child. Check out this page for lots more information along with commonly asked FAQ’s
This is a collaborative post.