It’s not too late to donate to a Junior ISA this tax year
There's time before the tax year ends on 6 April to save for a child's future, writes Hannah Loney from the Children's ISA.
Every parent and grandparent wants to give their child or grandchild the best possible start in life. Saving money for a young person’s future is a good way to do that.
These funds can help with education, a first home or to protect them from debt when they’re older. For example, the cost of buying a home has risen by a staggering 73% in the last decade, averaging more than £70,000 including deposits, stamp duties, mortgage repayments and annual maintenance.
For those with aspirations of their child going on to university, the real cost could be over £75,000 - when taking inflation into account - for children born today.
With the current tax window closing on 5 April, you don’t have long left to take advantage of this year’s annual limit of £3720 before the taxman gets his hands on more of your children’s future!
We have partnered with The Children’s Society to help maximize the impact of our work and the charity’s work with children.
The Children's ISA is an ethical collection of stocks and shares, managed by Ecclesiastical Investment Management. We favoured a fund that aims to combine profit with principles for the ethical investor such as Ecclesiastical, which has won the Moneyfacts Best Ethical Investment Provider award for the past five years.
The benefit to The Children’s Society is that every ethical Junior ISA account opened through ourselves will result in a £50 donation to support our work transforming the most disadvantaged children in the country.
That £50 could secure mobile phones for project workers so they are contactable at all times for children in danger and emergency situations, or could pay for a hot meal, shower and living essentials for two young runaways.
Set up an account today
Once a parent has opened a Junior ISA, anyone who has an interest in the child’s financial future can pay into it as long as the annual contribution allowance – currently £3720, and rising next year – is not exceeded.
The Junior ISA can be opened with a lump sum of £500 or a minimum monthly contribution of £50 per month; in fact many people open them with a lump sum and top them up with regular monthly payments or one off lump sums.
Some parents ask friends and family to contribute towards it as a Christening present whilst others often add to it on special occasions such as birthdays or Christmas, which is particularly popular with grandparents and godparents. Top-ups can be as low as £10 per month or a lump sum of £10.
Calculations show that if parents, family or friends contributed to save the full allowance each year, this could achieve a pot of almost £108,000 by the time the child is 18 years old (based on growth of 5% per year).
You don’t have long left to take advantage of this year’s annual limit of £3720 – set up an account today.