4 Ideas For Saving For Your Child’s Future | A Littlelondoner

4 Ideas For Saving For Your Child’s Future

Do you know how much raising a child costs in the UK? I was shocked to learn that on average, parents spend close to £230,000 on their first child by the time they are 21. Given that children aren't leaving home until their late twenties, it’s clear that those costs don’t stop for some time afterward.

Looking at this astonishing figure, there’s no doubt that saving for your child’s future has never been more important. I thought I would have a look around for some of the best ideas out there, and share them with you. Here’s what I found – and let me know if you have any more to add!


It’s not just about money

First of all, investing in your child’s future isn’t just about setting up savings and giving them a cash bonus when they go to university. Of course, this will be helpful – I dread to think how high tuition fees will be when our little ones go off to college. But, there is a massive case for spending some of that money now. There is a lot that can happen between birth and adulthood, and giving your child as many opportunities as you can, will help them get there. Think about musical instruments, extracurricular sports, or teaching them arts and crafts. They will all help with your child’s development far more than a full savings account. So, save away by all means – but not if it limits your child’s chances to grow.

Go tax-free

All parents have the opportunity to invest in a Junior individual savings account – or JISA. And the good news is, you won’t have to pay capital gains or income tax on it. They are a great starting point, and can pay off handsomely. For example, if you pay the maximum amount – currently £4,080 every year – from birth, and then a 5% interest rate gives them well over £110,000. That’s not a bad sum of money, which could pay for their university education or a healthy deposit on a house. Think about property If you have money now, then invest it. You just don’t know what will happen in the future, and building a robust investment portfolio will protect you against risk. Think about property investment, and look around for guaranteed returns. Hands-off investments almost take care of themselves, and there are plenty of options out there to choose from. Click here to take a look at some of the options – they range from investments in spa resorts and care homes to student digs and buy-to-lets. These sort of investments are usually 10-15 years long in the making, by which time your child will be close to their tertiary education.


Children’s Bonds

Another easy way of investing for your child’s future is by using Children’s Bonds. You get them through National Savings & Investments, so they are safe to use and have no risk at all. You can invest anything from as low as £25 a year, to as much as £3,000. However, they won’t give you the same kind of returns as my previous options. But they are a popular choice and better than a standard savings account.

So -what do you think? How are you saving for your child’s future? Why not let me know in the comments section below?

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T, A & H xxxxxx

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