Investing for your Children’s Future

When you consider the rising costs associated with your child growing up, there’s no doubt it makes sense to consider saving to give them a head start with their future. Whether this is with university tuition fees in mind or simply to help with the costs of buying a first car or home, saving regularly can help to build a nest egg for them when they need it.

In a survey of 2,000 UK adults conducted for M&G in October 2016, almost half (48%) said they had saved or invested money for a child or grandchild under the age of 18 in the last five years. The most common form of saving, according to the survey, has been into children’s bank savings accounts, despite interest rates on cash savings being near record lows.

14% of parents and grandparents reported that they had used another vehicle for child savings: the Junior Individual Savings Account (ISA). The advantage of ISAs is that any returns will be exempt from personal taxation. This will not