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
My almost two-year old son has a one in four chance of reaching the ripe old age of 100. A frightening statistic, not least because I will be 129 when he reaches three figures. This got me thinking about the financial challenges a child born today has in front of them.
Almost two years ago, shortly after my son was born, I worked my way through a to-do list and decided to prioritise one of those jobs that might fall by the wayside – opening a Junior Isa account.
Banks and building societies are busy cutting the rates that they pay savers. The falls impact easy-access accounts offered to new savers, as well as those that were on sale in the past. Thousands of savers are currently earning a pittance on cash languishing in more than 1,400 easy-access accounts, which are closed to new savers.
Anyone can now buy premium bonds for children, including aunts, uncles and family friends.
Previously, only a parent, grandparent or guardian could buy premium bonds in a child’s name.
This change to premium bonds was first announced in the October 2018 Budget and is aimed at creating a stronger savings culture.
This latest improvement to premium bonds follows the reduction of the minimum investment from £100 to £25 in February this year. The maximum that you can spend on premium bonds is £50,000.
Is it appropriate to give pocket money to a three-year-old? Well, one in seven parents think so and frequently splash the cash, according to research by the Nottingham Building Society. Just over one in four (26%) kids aged eight receive pocket money.
The research also found that giving between £5 and £9.99 was the most common; in terms of how often the payments are made, weekly came out on top. This means children who receive pocket money on a weekly basis are potentially pocketing as much as £520 a year.
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.