Have you thought about saving for your child’s future but haven’t got round to it yet?
If so, just putting aside even a small amount each month can really pay off when children reach 18. With the rising cost of living, it is becoming increasingly important for children to have savings to fall back on.
If you feel ready, consider these factors:
When choosing suitable savings plans or investments for your child, many of the same considerations apply as for adult investors.
•Timescale
Find out if the investment is suitable for the timescale you require, short term or long term. It is best to shop around. You can start early and you should
compare before you set up any kind of account.
•Accessibility
If you think the money may be needed at short notice, make sure there are no withdrawal penalties. Although when saving for children, it is best to make it a long term investment but we all know that there can be exceptional circumstances. So make sure you will not be penalised for accessing the funds in the account.
•Risk
Depending on your attitude to risk and the product you chose you may get back less than the amount you originally invested. So if you chose for instance, an investment in shares/stocks/bonds, then you should be aware that you have taken a risk which could bring you more returns or sometimes nothing.
•Charges
Even if you are saving only a modest amount, it is important to ensure that you are not paying excessive charges. Most children acounts are tax free so do shop around for a tax free children's account and then please read the small print.
Extra Tips
-Set up an account as soon as your child is born and encourage relatives and friends to add to the funds instead of giving gifts to the child.
-Teach your child about money as soon as they are old enough to know what money is. Buy them a piggy bank and take them occasionally to the bank to drop off their savings into their account.
The earlier you start saving, the better placed you and your child will be for the future.