Even small amounts tucked away regularly can build up a substantial nest egg, although inflation will reduce the spending power of that money over the long term. Assuming a growth rate of 5% a year, after charges, the table below shows how much a monthly investment could be worth in future. All investments can fall as well as rise, so your child could get back less than you invest.
Find out how you can start investing for a child's or grandchild's future.
|Time period||£50 per month||£100 per month||£300 per month|
Whichever account you choose, you can be confident it will be easy to manage, there will be a wide investment choice and it will be great value for money. See how our three accounts for children compare. Tax rules can change and benefits depend on individual circumstances.
|Junior Stocks & Shares ISA||Junior SIPP||Junior Investment Account|
|Eligibility||Any child resident in the UK – if they have a Child Trust Fund this will need to be transferred to open the account||Any child resident in the UK||Any child resident in the UK|
|Investment limits||£4,128 a year (2017/2018)||£3,600 gross a year (£2,880 net) (2017/18)||Unlimited|
|Withdrawals||At age 18 (except in the case of terminal illness or death)||At retirement - usually from age 55 (rising to 57 from 2028 but likely to rise further)||At any time, although the money must only be used for the benefit of the child|
|Account holder||The account belongs to the child but a parent or legal guardian must act as registered contact up to age 18||The account belongs to the child but a parent or legal guardian must act as registered contact up to age 18||The account belongs to a ‘trustee’, usually a parent or grandparent. At age 18 the child becomes entitled to any assets in the account|
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|Open a Junior ISA||Open a Junior SIPP||Open an account|