Any thoughts on the best way to put aside a regular monthly amount (say £100) for our 3 year old, to build up some savings for when she is 18?

Her 6yo sister has a Child Trust Fund which seems to have done remarkably well but they are no longer available and the alternatives (e.g. Child ISAs) all seem to be very poor.

Ideally we’d want to have it in her name, locked till she is 18, with a decent rate and no tax implications.

Ours have got savings accounts with the Halifax, used to really good 6% ish but less now, still better than a lot of the alternative s. Actually thinking about it they’ve got two, one where the dish goes in where you get a better rate for regular deposits up to a value then when that tops out it gets moved to a longer term one. Can’t be more specific, the missus deals with it all

Child ISA (stocks and shares variant). Put all the ££ into Vanguard VWRL ETF.

Thank me later 😉

Yeah we’ve got a few grand put away for her in some five year bond that gives 5% but that’s maxed out and only last those 5 years so we were looking for something longer term.

Child ISA (stocks and shares variant). Put all the ££ into Vanguard VWRL ETF.

+1.
In 15 years time it should do very nicely indeed!

Would you recommend getting one Cash and one Stocks & Shares Junior ISA and splitting money between them to reduce the risk a bit by giving a guaranteed return on at least some of it? Or just go full barrel into the Stocks & Shares?

Go full barrell into stocks and shares. You have 15 years of ups and downs ahead. Some years you may lose money but most you will gain. An S&S Isa should comfortably outperform cash.
If you must have some cash savings you’ll probably find non Isa savings accounts pay a better rate than Isa savings accounts.

I’ve set up a S&S ISA holding VLS100 for our daughter, only half the money goes in it though, the other in a cash ISA as my wife doesn’t get that over 17 years the stock market will always outperform savings, especially when rates are so low.

if you want a ‘safer’ place (I wouldn’t bother), NS&I offer child bonds @ 3% return/year (5 year fix)

Thanks guys – despite being fairly geeky in various other aspects of life I’m afraid I completely glaze over when it comes to finances, so apologies for any silly questions.

How would one specify that they wanted that Vanguard fund? Do you need to go with a particular Junior ISA provider to get that option or is it something they should all offer? If the latter then how do you pick between providers?

if you want a ‘safer’ place (I wouldn’t bother), NS&I offer child bonds @ 3% return/year (5 year fix)

Thanks 5lab – yeah I think that must be where we’ve put the current lump sum of cash, but that was really just a stop gap till we figure out somewhere to put a regular contribution.

I recommended Charles Stanley to my brother for his kids JISA.

https://www.charles-stanley-direct.co.uk/Our_Services/JISA/

They allow the Vanguard fund.

We’re currently looking into this & I am wondering what the advantage is of setting up a junior ISA compared to me just setting one up & handing it over to her at a certain age in the future….?

Is there some kind of tax benefit of having a junior ISA over me just opening it up & then handing it over – bear in mine we’ll never be able to save the max ISA amount per year, so we wouldn’t benefit from any increase in the total amount saveable if this is relevant.

I think the only “advantage” is that it’s locked in until 18, so there’s no risk of you dipping into it in the meantime.

I assume the fact that it is held in the child’s name also makes it a bit easier if the parents were to die?

One less argument over the estate (though I guess a good will also helps here).

Some more advice in this topic from a few weeks ago http://singletrackworld.com/forum/topic/child-savings-account

My thoughts
My kids funds are in a stocks and shares isa in my name. Makes it easier to manage in the future as I have a degree of control over what they can get and when, rather than many of the kids specific accounts which automatically go into their control at a certain point in the future.

We’ve got a bit of money to put away for our daughter as a lump sum & will then top-up with savings of our own when we can afford to.

I was looking at the best place for this & didn’t realise that you can now have up to £1000 in savings interest that isn’t taxed – so for a lot of people, there is no advantage to opening an ISA unless you can get better returns – i.e. investing in a stocks & shares ISA might be better than just a ‘high’ interest saving account.

I’ve got an HSBC premier account, so am going to open a regular saver which offers 5% over the 12 months. I’ll pay in the max amount possible in the early months and then drop it down to the min allowed (£25/month) for the rest of the 12 months, so we get the max interest benefit.
After the 12 months, we’ll probably transfer it to a stocks & shares ISA.

If you give money to a child it does not “leave” you for tax purposes so the income is still assessable on you. However, this rule does not apply to money put into a child ISA.