Savings accounts: children ensuring security
Check out the benefits of setting up your child or grandchild with a Junior Individual Savings Account.
09:37 21 April 2013
The current state of the economy may shift attention onto creating savings accounts. Recent activity has led to new policies guaranteeing accounts up to an amount of £85,000 so money is even safer than before when it’s placed in a savings account.
Many people are familiar with Cash Individual Savings Accounts (ISAs) and Stocks and Shares ISAs, but there is a large percentage of people who were not aware of the fact that there are now Junior Cash ISAs and Junior Stocks and Shares ISAs.
Setting your children or grandchildren up with one of these accounts helps funds to grow so that you can be sure your children will be financially prepared for the future, whether it is to attend university, to keep as a nest egg, or to invest in the purchase of their own home.
Here are some of the benefits of setting up one of these Junior Individual Savings Accounts:
- Earned interest for both types of Junior ISAs are tax-free
- No tax on capital growth or dividends (Junior Stocks and Shares ISAs)
- Able to have one of each type of Junior ISA for your child or grandchild
- Able to switch funds from one type of Junior ISA to the other
- Deposits up to a total of £3,720 are allowed and can be split between two accounts if you get one of each type.
- Money can still be added the if the child moves overseas
- Will stay in the account until the child reaches the age of 18 with certain exceptions
- Junior Individual Savings Accounts automatically switch to regular ISAs once the child turns 18
- Allows families to stow away money for university
- Funds can be used if child becomes terminally ill to help with medical and care costs
These are just a few of the benefits of starting Junior Individual Savings Accounts. The sooner you start saving the more your child or grandchild will end up with, and the better prepared they will be to weather financial setbacks.