Junior ISA 6th birthday

The Junior ISA child savings account was launched by the government in November 2011 and this month sees the plan’s 6th birthday. The savings plan has proved a real winner, with around two million Junior ISAs having been opened in its first five years and no sign of its success slowing down.

Here’s a brief reminder of why the Shepherds Friendly Junior ISA has already proved so popular:

You can save in our Junior ISA from as little as £10 a month right up to your child’s annual ISA allowance of £4,128 a year.

Tax rules mean that saving in our Junior ISA is tax-efficient, making it exempt from capital gains tax and income tax. This means all growth within the plan and money withdrawn from the plan is tax-free.

Once the plan has been opened, anyone who wishes can make payments into it, making it accessible to family and friends and helping to boost the value of your child’s fund. This provides an ideal opportunity to invest any cash gifts received around Christmas or birthdays.

Shepherds Friendly adopts a medium to low-risk investment strategy, with the aim of paying annual bonuses into your child’s plan. This could help you to achieve your savings goals for when the child reaches age 18, whether you’re looking to help your child cover the costs of their further education or buy their first home or car

As well as your contributions into the Junior ISA, we’ll aim to add a bonus annually to help your child’s investment grow. The size of the bonus can vary depending on investment conditions*, but we promise that once we have added a bonus we will never take it away.

The good news for Shepherds Friendly members who have already opened a Junior ISA, and for those of you who may be looking to do so in the near future, is that we have recently reduced the management fee on our plan to 1.5%.

It’s worth noting that over the past five years our Junior ISA has returned a consistent 3% growth**.

So as we celebrate the Junior ISA’s 6th birthday, this makes it an ideal time to consider topping up your child’s plan if you’ve already opened one or to start saving today to help build them a really useful nest egg.

* When you take out an investment product with us your capital is at risk and you may get back less than you have put in

**Past performance cannot be taken as a guarantee of future returns.

All references to taxation are to UK taxation and are based on Shepherds Friendly Society’s understanding of current legislation and H M Revenue and Customs practice which may change in the future. Investment growth is by means of bonuses, the amount of which cannot be guaranteed throughout the term of the contract. Please ensure that you read the full terms and conditions of this plan which are available from your financial adviser or by contacting us directly

No advice has been provided by Shepherds Friendly. If you are in any doubt as to whether a plan is suitable for you, we recommend getting in touch with a financial adviser, who will be happy to take you through what options are available. Should you consult a financial adviser there could be a cost involved and you should confirm this cost beforehand