Easter is now approaching and with it comes the beginning of spring. Flowers will bloom, trees will start to grow green leaves and the days will get warmer and longer.
Traditionally, we celebrate Easter by giving each other chocolate eggs of all kinds of sizes to celebrate the new life that comes along with spring. Many children will be given lots of chocolate eggs from their friends and family, so we thought it might be nice to give them a slightly less conventional Easter present.
This year, the alternative to the chocolate Easter egg could be a savings “nest egg” for your child. The money that would have been spent on chocolate eggs could be put into a Junior ISA savings account, and be built up over time, until they receive a lump sum of money when they are 18 years old.
Benefits of a Junior ISA
- All children under the age of 18 who do not have a Child Trust Fund (CTF) can qualify for a Junior ISA, and soon children with CTFs will be able to transfer it to a junior ISA.
- Owners of the Junior ISA save tax efficiently
- Anyone- parents, grandparents, family, friends, can pay money into a Junior ISA, up to the maximum annual allowance.
- Savings can be spent on anything the child chooses when they turn 18- university fees, first car or a deposit for a house
Some things you should know about Junior ISAs
- When a parent opens a Junior ISA, the money that is paid in will automatically belong to the child, When your child turns 18, they do not have to spend the money and can instead transfer it to an adult ISA and continue to save tax efficiently
- The money paid into a Junior ISA will not be able to be accessed until the named child turns 18 (there are some very rare circumstances where the money can be accessed before)
In ever changing environment of today, saving for your child is more important than ever. To be able to have a little bit of financial security at the beginning of your adult life is an amazing gift. The Junior ISA is very popular among many parents due to its relaxed nature. Savers are welcome to set up a direct debit, or can simply pay in certain amounts whenever they have some excess money, at the end of the month, or after a bonus for example.
As well as being a great children’s saving plan, the Shepherds Friendly Society is proud to have paid out an annual bonus each year to each of its Junior ISA members, ever since it was launched.
As well as our Junior ISA, Shepherds Friendly also offers other tax efficient saving plans!
University savings plan
Our University Savings plan offers you the chance to save for your child’s future, specifically to save enough money to cover the costs of a university education and living expenses. It offers a unique withdrawal process, which works when your child is aged between 18 and 21. They can take a full lump sum in one go or withdraw the money in stages throughout their course, to help meet the costs of annual tuition and living fees.
Don’t worry, if your child decides not to go to university, the fund can be used to give them a head start, by providing them with a tax-free lump sum spend on whatever they see fit.
Young Saver Plan
Our Young Saver Plan is slightly different to a Junior ISA. You don’t have to be the child’s parent to open a Young Saver Plan, meaning you can save for any child whether it’s you grandson, niece, nephew or a child you care about. Sending your child to secondary school can be expensive, so you can take up to a quarter of the fund to help pay for uniforms, stationery and anything else they might need.
You can save as little as £7.50 a month, up to a monthly limit of £100 and increase or decrease your premiums whenever you want.
Savings nest egg
So this Easter, why not treat your children to a savings nest egg. You can help foster long term savings habits, ensure a steady financial start and offer them an amazing gift throughout their financial life. Maybe this year, leave the chocolate eggs to the grandparents!
For more information on our Shepherds Friendly child savings plans, please call our friendly customer service team on 0330 134 5898 or click here