Life is expensive. From the purchase of your first home, further education costs, travelling or even wedding planning, the expenses your child will incur when they turn 18 are plentiful. Did you know, you can ease the financial burden by gifting them a pot of money when they turn 18? You can build this pot throughout their childhood, little by little. In this blog post, we’ll explain what a Junior ISA is, its benefits, and the features of our account.

What is a Junior ISA?

A Junior ISA is a long-term, tax-free savings account for your children. The account must be opened by the child’s parent or legal guardian. Up to £9,000 per tax year can be invested in a Junior ISA. This doesn’t have to be invested solely by the child’s parent or guardian, though. Grandparents, friends and family can contribute too! Any money invested in the account belongs to the child, but cannot be withdrawn until they turn 18. So it’s a great way to invest in your child’s future.

There are two types of Junior ISA: Cash and Stocks and Shares. The former is a savings account where you do not pay tax on the interest earned. This means the pot will grow quickly. A Junior Stocks and Shares ISA is also available. Here, your money is invested in stocks and shares, and any profits you make are tax-free too!

Why should you invest in a Junior ISA?

Investing into a Junior ISA for your children can also be beneficial to you. The money you invest is free from income tax or capital gains tax. It’s therefore a tax-efficient way to save. As any invested money is locked away until your child is 18, your money has the best opportunity to grow. It’s therefore great for long-term financial planning.

You may not feel that you have much money spare each month to invest. But every little bit invested will help you build the pot for your children. By saving £75 per month into a Junior ISA, it could be worth over £30,000 when your child turns 18. Whatever the pot value, your child will be able to put it towards further education tuition, their first home, driving lessons, travelling. Wherever their dreams take them.

Features of the Willday Wealth Management Junior ISA

We offer a Stocks & Shares Junior ISA. As with all Junior ISAs, it is a long-term investment strategy. You can save up to £9,000 per tax year, and the money can’t be withdrawn until the child is 18. You will, however, have 24/7 access to monitor the account via the Willday Wealth Management app. Our dedicated team of investment consultants are also on-hand any time.

Why not share your child’s account details with family and friends? They may wish to contribute on your child’s birthday, for Christmas or to pass on inheritance tax wealth for example. They can help give your child a tax-free lump sum on the day they turn 18. Your child will receive tax-free returns on the investment into the account each and every year. We offer simple and transparent fees for our service. There is no fee to set up our Junior ISA – we receive an annual fee of 1%, depending on the fund value.

With investing, your capital is at risk and you may get less that what you invested. Tax treatment depends on your individual circumstances and may change in the future.

Have an existing Junior ISA? Why not transfer it to Willday Wealth Management?

If you’ve already taken out a Junior ISA, but love the sound of what we can offer you, don’t worry! You can transfer it to us and watch your investment grow. We’ll make sure the transfer is as smooth as possible. All we need to know from you to make it happen is the Junior ISA location and the account number. We’ll do the rest! Plus we’ll be on-hand to answer any queries you may have, via phone or email.

Willday Wealth Management giving back

We have teamed up with Willsow, manufacturers of plantable children’s books. Once your Junior ISA is opened, we’ll send you a book in the post about a carrot who is too big for his bed. The great thing is, once your child has finished reading the story, they can plant the cover of the book and grow their own carrots! That’s because they’re printed on special seed paper – so your child can read the story, then meet the main character!

As a company, Willday Wealth Management support the Woodland Trust. For every Junior ISA that is opened, we plant four trees. So, whilst you’re saving for your child’s future, we’re helping make sure they have a greener future too.

Your next steps

Whether you have a specific event in your child’s life in mind, or are just looking to invest in their future, a Junior ISA is for you. Contact us now to start the process of setting up your account.