Investing For Grandchildren

Investing for grandchildren can take a number of forms and can be either structured where the investments are specifically designated for the grandchildren or informal arrangements whereby investments already in place are potentially earmarked as gifts for grandchildren at a later date.

Examples of investments for grandchildren include:-

  • Junior ISAs
  • Bank, building society and Post Office deposit accounts
  • National Savings & Investment products such as Children’s Bonds and Savings Certificates
  • Unit Trusts
  • Investment Trusts
  • Child Trust Funds
  • Regular savings accounts

One of the benefits of children’s investments which are funded by contributions from grandparents is that any interest is assessed on the child who is then able to utilise their personal allowance and have the interest paid without deduction of income tax.

Interest in excess of £100 per annum earned by children from investments funded by a parent are assessed for income tax purposes as being the parent’s income and, therefore, subject to income tax.

When considering investing for your grandchildren, you should take into account:-

  • Whether you wish to make a one-off investment or have a regular monthly commitment.
  • At what age you would like your grandchildren to have the capital.
  • What is your objective for the capital – school or university fees or a deposit for a first home.
  • Do you want your grandchildren to have control over the investment or maybe a trust arrangement would be preferred.
  • The level of investment risk that you are willing to take.

There are, of course, other factors that need to be considered and if you are looking to invest either in some form of asset backed investment, such as a unit trust or investment trust, or feel that a trust arrangement would be suitable, you should consult an suitably qualified and impartial adviser who will be able to help you in establishing the most suitable investment scheme for you and your grandchildren.

Invest from
£100
Investment Options

Simple, transparent – Invest in one of a range of expertly designed portfolios depending on your investment style. No exit fees and you’re free to make adjustments. You can see where your Junior ISA is invested and how it’s performing.

 

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Good to know: All Nutmeg investment styles are built by experts and use exchange traded funds to diversify across stocks, bonds, industries, even countries. Choose the one that works for you. Capital at risk. Tax treatment depends on your individual circumstances and may change in the future.
Regular investment service
from £25 a month
Investment Options

Wide range of investments including shares, funds, investment trusts and ETFs (exchange traded funds), or get help picking your own portfolio

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Good to know: Which? Recommended Investment Provider. Low-cost Junior ISA, buy and sell investments online from just £1.50. Investment ideas from AJ Bell specialists if you’d like help picking your portfolio or huge range of investment options if you’re happy to go it alone. Lump sum or regular investment service. Capital at risk.

Important information: The value of investments can go down as well as up so you may get back less than you invested. AJ Bell doesn’t offer advice, so it’s important you understand the risks, if you’re unsure please consult a suitably qualified financial adviser. Tax treatment depends on individual circumstances and all tax rules may change in the future.
Regular Savings
From £1 pm
Investment Options

Choose from one of five investment styles based on risk, and a team of experts build your child’s Junior ISA, choosing which investments to buy and managing them on your behalf

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Good to know: You can choose to invest for your child in an Ethical Plan or an Original Plan. Wealthify Junior ISAs contain a range of investments from across the globe matched to the level of risk you choose. Each Junior Stocks & Shares ISA will contain up to 20 investment funds from providers like Blackrock and Vanguard. Wealthify is authorised and regulated by the Financial Conduct Authority (FCA). Your money is looked after by a team of experienced and qualified investment managers. Invest up to £9,000 per year and/or transfer from an existing Junior ISA or Child Trust Fund.
Capital at risk.
Important information: The value of investments can go down as well as up so you may get back less than you invested. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser. Tax treatment depends on individual circumstances and all tax rules may change in the future.
Regular Savings
From £10 pm
Investment Options

Invests in the Friendly Society’s With Profit Fund

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Good to know:  Shepherds Friendly Society founded in 1826 is owned by members and does not have shareholders. The Shepherds Junior ISA is invested in the Society’s With Profit fund in a manner that means your child’s money is less affected by short-term stock market fluctuations, so will not lose or gain value on a day-to-day basis. Instead, they will aim to add an annual bonus at the end of each year, the value of which will depend on the performance of the fund during that year.

Please note: As with all investing, your capital is at risk you may get back less than you have put in. The value of the ISA will depend on the performance of the investments and any bonuses cannot be guaranteed. Additionally, if investment conditions are poor, we may apply a Market Value Reduction (MVR)
Regular Savings
From £25 pm
Investment Options

FREE Children’s ISA Guide. Choose from over 2,500 unit trusts and OEICs from leading fund managers. Invest from £25 per month or lump sums of £100.

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Good to know: With an HL Junior Stocks and Shares ISA, you can choose investments for your child including UK and overseas shares, Investment trusts, bonds and exchange-traded funds (ETFs). HL have over 1 million clients who trust them for their investments. Capital at risk.

Important information: The value of investments can go down as well as up so you may get back less than you invested. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser. Tax treatment depends on individual circumstances and all tax rules may change in the future.
Invest From
No Minimum
Investment Options

Choose your own investments, invest with help from an adviser or let the experts take care of it all for you

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Good to know: Junior ISAs work in the same way as adult ISAs. They give children an allowance every year to save money or invest without paying any Income Tax or Capital Gains Tax. This year the annual Junior ISA allowance is £9,000
Invest From
£25 regular savings plan or £100 lump sum
Investment Options

One of the widest range of funds on the market, as well as shares, ITs and ETFs. You can get investment ideas from Fidelity’s experts.

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Good to know: Boring Money Best Buy JISA award 2023 (2nd year in a row). Investment choice with one of the widest range of funds on the market, as well as shares, ITs and ETFs. One low-cost service fee of 0.35%. Great service – from investment guidance on website through to UK-based phones team. Navigator (providing users with a diversified fund in a few easy steps, based on the level of risk they’re comfortable with and the investment approach they want to follow), Select 50, Investment Finder – investing tools for beginners to advanced investors. 24/7 access via online Account Management system. Capital at risk.
Important information: The value of investments can go down as well as up so you may get back less than you invested. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser. Tax treatment depends on individual circumstances and all tax rules may change in the future.
Regular Savings
From £10 pm
Investment Options

A selection of eight funds to choose from low to high risk, so you can tailor your child’s investment.

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Good to know: Scottish Friendly funds include a UK Government Bond Fund, A UK Tracker Fund and a UK Actively Managed Fund. When you take out a My Select (Junior ISA) Scottish Friendly will pay £50 into the Junior ISA for your child. Winner of Best Junior ISA Provider at the Investment Life and Pensions Moneyfacts Awards 2019.
Important Risk Information: This website contains information only and does not constitute advice or a personal recommendation in any way whatsoever. The value of investments and income from them can fall as well as rise and you may not get back the full amount invested. The tax efficiency of ISAs is based on current tax law and there is no guarantee that tax rules will stay the same in the future. Different types of investment carry different levels of risk and may not be suitable for all investors. Prior to making any decision to invest, you should ensure that you are familiar with the risks associated with a particular investment and should read the product literature. If you are in any doubt as to the suitability of a particular investment, both in respect of its objectives and its risk profile, you should seek independent financial advice. * Details of how the Financial Services Compensation Scheme applies to investment firms can be found at fscs.org.uk.