With interest rates slowly back on the rise, we round-up the best savings accounts and Isa accounts on offer in 2019.
Investing for children
It is well documented that when it comes to personal finances, the millennial generation (to which I belong) are worse off than their parents. However, some older readers of the babyboomer generation may vehemently disagree and point out they were simply shrewder savers. They also faced the challenges of interest rates hitting double-digit territory in 1988 and remaining at such levels until late 1992; moreover, over the past decade savings rates have been cut to the bone.
A couple of weeks after my son was born 18 months ago, I decided to take time out from the nappy-nap-burping carousel to set up a Junior Isa. I invested the money, which puts me in the minority of parents, as most opt for the safer option of cash. But given the long time horizon, the odds are firmly stacked in favour of investment winning the growth race.
It’s that time of year again. The one day where mothers get a lie in, a card, and, if we’re lucky, a cup of tea in bed to say thanks for all the work that we do.
I look forward to Mother’s Day as much as any other overworked mum. However, the sentimentality of the day can be a little cloying. Amid the avalanche of flowers and soppy cards, it’s important to remember that motherhood isn’t all hearts and teddy bears.
I often hear from grandparents that they would like to do something to help their children and grandchildren with building up a pension, so this month’s pension clinic runs through some of the things you need to be aware of if you are planning to help out in this way.
Individual Savings Accounts (Isas) are a useful way to stash up to £20,000 each tax year in a wrapper the taxman can’t touch. They remain popular with savers, who poured a record £608 billion into adult Isas in 2017/18. But the focus is shifting. With interest rates on cash Isas pitifully low and the personal savings allowance exempting most people from paying tax on their savings, cash Isas’ popularity has waned, while inflows into stocks and shares Isas have hit new highs.
If you know anyone with a child or grandchild who has turned 16 since last September, you can help ensure they don’t miss out on ‘free’ cash that might be sitting inside a Child Trust Fund (CTF) – the precursor to the Junior Isa.
CTFs are now coming of age: an estimated six million young people have money in these accounts, which contain a government contribution of £500 for every child.
The British public has long had a love affair with premium bonds, but the figures show that buying premium bonds for children or grandchildren is likely to be an unrewarding relationship. My own experience is a good example: I have a few hundred pounds in premium bonds from my late grandparents. Over about 20 years, I have won £50.
I felt a bit mean at Christmas 2017. With my son only a couple of months old and dribbling being his main hobby, it was decided that the only present under the tree for him would be something he won’t get his hands on for at least 16 years – a Junior Isa.
The costs that a young person faces in early adulthood are on the rise: a university degree, a wedding and a first home are all getting more expensive. However, investing for a child’s future can help them get off to a good financial start.