How to invest in your child's future

How to invest in your child's future

It's an expensive business having children, and the costs only increase as they get older, so people love to tell you. So is it even possible to think about investing in their future? According to F&C Investments there are ways we can start saving for our children's future


The latest scary figures being thrown at parents is that the average cost of raising a child from birth to the age of 21 is a staggering £218,000. If your child then chooses to go to university, the average debt a graduate leaves university with is £53,000. So finding a way to save for these huge costs from when they are young is very much a necessity for most of us.

Here's some helpful advice of how to do this from F&C Investments

The common misconception about investments is that you need to be rich. This isn't the case. You could either start an investment endeavour with a lump sum of £250, or you could simply make regular investments of £25 per month. You may feel that you understand enough about investments but if you take advice and end up choosing a plan, remember part of your plan is advice from the experts you get the plan with.

Investments designed for children

Junior ISAs

The main type of investment plan for children is the Junior ISA. This account type became available in 2011 as a replacement for the Child Trust Fund program. The Junior ISA allows you to make tax-efficient savings in the same was as a regular Individual Savings Account. If your child already has an existing Child Trust Fund, you can't open a Junior ISA. The annual contribution limit is currently £4,000, and this money is accessible once your child turns 18.

Child Trust Funds (CTF)

If your child has an existing Child Trust Fund, the annual contribution limit matches the Junior ISA. There are different types of CTF accounts including shares, stakeholder, and savings or cash. You can't open a new CTF, but you do have the option to change the account type, or transfer a CTF from one provider to another.

Alternative Investment Plans

If you want an alternative investment plan where you have more control and flexibility over access to your child's funds, you can choose an investment plan where you can decide when they get the money. By retaining ownership of your child's funds you can use them towards school fees or to help pay for equipment
for your child's hobby.

Collective Investments

There are also alternative investment options in the form of collective investments. These investments allow you to use your contribution together with contributions from other investors, enabling you to invest in multiple places, whilst protecting you against a bad investment choice wiping out your funds.

There are two types of collective investments available - specialist and generalist funds. A generalist fund allows you to invest in multiple industries, whereas a specialist fund is an investment in a specific industry sector or geography.

Getting Started

If you are looking to make the most of your child's money, investments can be much more lucrative than savings accounts. The earlier in a child's life you can begin investing the better, as it will have time to grow before it's needed. However, if you have less time you can choose an investment plan that suits your needs and timeframe. It is never too late to start investing.


Related Articles

Find the sport perfect for your tot
Find the sport perfect for your tot
Find the sport perfect for your tot Getting active is important for all...
Four mums on baby weight
You and your body
Four mums on baby weight
Four mums on tackling the baby weight Wonder if you'll ever get back in your...
Parenting rules: What worked for us
Parenting rules: What worked for us
Parenting rules: What worked for us Ever wondered what goes on at home with the...
Social media challenge for new mums
Social media challenge for new mums
The social media challenge for new mums Do other mums' chirpy baby updates ever...

email block


Swimming taught by experts…that’s the Puddle Ducks difference

Puddle Ducks teaches children, from birth to 10 years, to swim independently, beautifully and confidently.

Happy Nappies! How to avoid nappy rash this summer

Don’t let a bad bout of nappy rash spoil a day out with your little one.

What can you do about gender disappointment?

Gender disappointment is common and certainly nothing to be ashamed of. Here are some ways to deal with finding out...

LEGO DUPLO has launched three fantastic fun-filled Disney Pixar Cars 3 sets

Pre-school fans of Disney Pixar Cars 3 can recreate all the fun of the new movie with three exciting and...

WIN a Little Swallows Travel Cot from Izziwotnot

Enter our competition for a chance to win a luxury travel cot worth £89!

Win free tickets to This Morning Live and see our Editor Scarlett on stage with Holly Willoughby

See Gurgle Editor Scarlett Brady on stage with Holly Willoughby, Dr Rang and Editor of Netmums Annie O Leary to...