Saving option for child without automatic access at 18?

A question about : Saving option for child without automatic access at 18?

Hi,

I've been putting money away for my daughter since she was born but it's just been in a generic saving account (under my name) but I would like to maximise the return on this and was looking at the JISA.

My daughter is only 2 at the moment so I don't know what if she's likely to be financially savvy at 18 so I don't know if she will use it wisely or blow it all on freshers week (hopefully not) so I would prefer that she doesn't get automatic access at 18 which is why I've not made the switch yet.

Personally, I would rather retain control of the savings and be able to use the saving pot to pay her rent at uni so she can concentrate on her studies so I was wondering what the best options are for that?

Many thanks.

Chris.

Best answers:

• Money held in a JISA can be controlled by the child at 16 and accessed at 18.
  https://www.gov.uk/junior-individual...ounts/overview
  If money is held in bare trust for a child, the child has the right to access and control at 18 (16 in Scotland).
  "If a parent gives money to a child (outside tax privileged accounts like JISA) and over Ј100 is earned in interest, the interest will be taxed as the parent's.
  While you could set up a Discretionary Trust which would would allow distributions at the Trustees' discretion, this would be a parental trust for a minor and taxed accordingly.
  You might prefer to regard your own ISA as "earmarked" for your child and then make maintenance payments etc once the child goes to University.
  Such gifts would not fall within the IHT regime should this be relevant.
  https://www.gov.uk/inheritance-tax/gifts
  There's no Inheritance Tax on gifts to help with other people's living costs. These include payments to:
  an ex-husband, ex-wife or former civil partner
  a relative who's dependent on them because of old age, illness or disability
  a child (including adopted and step-child) under 18 years old or in full-time education."
• Hi,
  Thanks for the advice. I was thinking it would have to be an account of some sort that was under my name rather than my daughters so I think I'm going to do as you suggest and earmark my own ISA for my daughter.
  Many thanks.
  Chris
• The trouble is Adult accounts and ISAs have lower interest rates.
  I have a Halifax branch only account for my daughter that pays something like 3.5% interest. I am in charge of this account, but it becomes hers at 16. I intend to move the money elsewhere before then!
• Hi,
  I just might not understand all this but I thought that if the account was in your daughters name and you wish to transfer it before she turns 16 it would have to be to another account in her name meaning she would still have control over it in the end?
  Otherwise, what would be to stop people putting savings in child accounts and just taking the money out before they get access to it?
  Many thanks.
  Chris.