Junior ISAs

Want only the very best for your child? Let us help you.

- Posted by Graham Elson on April 21, 2017

As parents, we all want to give our child(ren) the best opportunities in life. Whether it’s going on the end of year school trip, getting into the best university, taking a gap year to travel the world or perhaps help them get onto the property ladder, as adults we can appreciate how hard these stepping stones can be at times.

However, Rome wasn’t built in a day and the same goes for saving money. So, finding efficient and intelligent solutions to start saving early for your child’s future may be the best thing you do this month.

So, what is a Junior ISA and how will it benefit you and your family?

Junior ISA’s work in the same way conventional ISA’s do, except they are designed solely for under 18’s. Although the money will always belong to your child, it is important to remember that your child will not have access to this money until they are 18. They can, however, start to manage and control their account once they reach the age of 16.

The Junior ISA limit rises in line with inflation every year and for this tax year 17/18, the limit has risen to £4,128 which is great news for those already saving and for those looking to open a Junior ISA. There are two types of Junior ISA’s and before deciding which is the right option for you it is important you understand what each one means for you and your child’s future.

The first option is a Junior Cash ISA. This type of Junior ISA is very similar to a normal bank or building society saving account but with one advantage – your child does not have to pay tax on the interest they earn from their savings.

The second option is a Junior stocks and shares ISA. With this type of ISA, you invest the money saved into shares and bonds. This puts your money at higher risk than the cash ISA but could give you more profit for your investment in the long term. Any profits earned by shares and bonds are also free from tax.

As always, it is important to remember that your capital may be at risk.

At Elson Associates, we have been arranging discounts on investments for over 20 years. Our family is important to us and we know it is to you too, so we take pride in providing you only the best services and offers at the lowest prices so your child can become everything they dream to be.

For more information on all our offers and services, contact us today via our contact page click here.