Menu Menu Menu Login Login Log in Search Search Search

Hargreaves Lansdown marks its 100,000th Junior ISA with a golden Pedro money box

Sarah Coles | 11 September 2017 | A A A

Press releases have been specifically designed and written for use by the media. They are not a communication for investors, personal advice or a recommendation to either invest or to refrain from investing.

No recommendation

Press releases have been specifically designed and written for use by the media. They are not a communication for investors, personal advice or a recommendation to either invest or to refrain from investing.

Media contact:

Danny Cox

Head of Communications

Direct Line: 0117 317 1638

Mobile: 07989672071

  • 100,000th Junior ISA could become a property deposit, says dad (case study below)
  • Record numbers of Junior ISAs subscribed in 2016/17 - 794,000 – and £858 million subscribed
  • Top ten trackers chosen by HL Junior ISA investors
  • Junior ISA heading for 6th anniversary (1st November)

HL has marked our 100,000th Junior ISA with an Aardman designed golden Pedro the penguin money box. The lucky recipients was eight-year-old Charlotte Pitt, whose father, Ed, transferred her Child Trust Fund to an HL Junior ISA.

Pedro the penguin money boxes have been free with each new HL Junior ISA account.

Sarah Coles, Personal Finance Analyst, Hargreaves Lansdown:

"You don't have to put away much for your children or grandchildren in order to ensure their first adult financial experience is one of the incredible power of compound returns. Even with a monthly contribution of £25, assuming growth at 5%, they could reach the age of 18 with £8,730.

"Those who take full advantage of the annual limit of £4,128 (£344 a month), assuming the same 5% growth rate, would be looking at a potential nest egg of £120,626 by the age of 18. That could ensure they finish university debt-free, and help them get their first step on the property ladder.

Parents and grandparents are looking ahead and using savings and investment products such as the Junior ISA to help soften the impact of the higher education debt mountain and get their children and grandchildren onto the property ladder.

Transfers from Child Trust Funds (CTFs) to Junior ISA have also been available since April 2015. However over 900,000 CTFs are thought to be “gone-away” where the provider does not have the correct contact details for the child or their parent. Parents with children born on or between 1 September 2002 and 2 January 2011 should check which CTF has their child’s money via HMRC and then make sure it is working hard for them.

Tracker funds work well for Junior ISA investors as they are a simple and cost effective stock market investment option. Holding cash for what could be an 18 year time period is simply the wrong choice."

Junior ISA Case study

Ed was keen to invest for all three of his children he says: "It’s most likely that their biggest need will be for housing when they are in their 20s." While he appreciates that from the age of 18, it will be entirely up to his offspring what they do with the proceeds from their Junior ISAs, he says: "I hope that it will contribute towards a housing deposit."

Opening the JISA was part of Ed’s plans to spring clean his children’s existing investments. Two of them had Child Trust funds, and one of was born after the end of the regime, and so had no long term savings. The two CTFs also contained different sums of money, so he thought it was time to level the playing field. “We’re going to balance out the money so it’s fair and all our children are receiving the same,” he explains.

He decided that Junior ISAs offered the most suitable approach, and adds: "We found out that we could transfer CTFs to Junior ISAs, so it seemed like the logical way forward". He plans to make the maximum contribution of £4,128 in the first tax year for each child, and then top it up when finances allow. He says: "We’ll probably carry on investing a reasonable amount of money in the next few years."

He wanted to invest the Junior ISAs in stocks and shares, explaining: “I didn’t want to save for the children in cash. I was keen to have the money invested in the UK stock market because when you invest for kids, you’re looking at investing for at least ten years.” He adds: “With the returns on cash as low as they are, it seems stupid to me to keep your money in cash.”

He has chosen to invest in UK index trackers, saying: “I’m investing in index trackers, because they’re low cost and low effort. Otherwise I think you have to do too much thinking, and I don’t want to do that. I’ve just got faith that over the long term, the UK stock market will perform really well.”

As well as helping his children save for the future, Ed is hoping the Junior ISAs will encourage an interest in investing. He says: “I learned about the magic of compound interest way too late in life. I should have started putting money away when I was 15.” He hopes that the lump sum building up in his children’s Junior ISAs will help them see the benefits of investing for the long term.

Ten top selling tracker funds within a Junior ISA (alphabetical order)

NOTES TO EDITORS

Globelynx and ISDN ready

Hargreaves Lansdown is equipped with a live in-house broadcast camera via the Globelynx network and has an ISDN line available for radio interviews - 0117 934 9006. To arrange an interview with a Hargreaves Lansdown spokesperson please contact the person you wish to speak to directly using the contact details above, or call Globelynx on 0207 963 7060 or email globelynx@globelynx.com.


Press releases have been specifically designed and written for use by the media. They are not a communication for investors, personal advice or a recommendation to either invest or to refrain from investing.