Posted: 28 July 2014

New way of saving for you and your children

We have partnered with The Children's ISA to offer a tax efficient option to help you save for your child or grandchild's future through an ethical Junior ISA.

Today, Hannah from The Children's ISA writes about the partnership and a new development in the amount that you can save each year.

How the New ISA can affect savings plans

A number of people are wondering how the New ISA - often known as 'NISA' - that was introduced for adults earlier this month will affect their savings plan for their children with child trust funds (CTFs) or Junior ISAs.

The NISA was a welcome surprise from the chancellor because adults will be able to keep up to an additional £3120 in this tax year.

How does this affect parents?

CTFs and Junior ISAs are not affected by the introduction of the NISA as such as it is for adults. However, when the NISA was introduced on 1 July, the tax-free amount that can be put into a CTF or Junior ISA for the 2014-15 tax year increased from £3840 to £4000.

Parents who have either of these tax-free savings accounts for their children can take advantage of this increase, and as of 1st July they can top-up their CTF or Junior ISA accounts. 

Topping up your junior ISA savings 

Once a Junior ISA is opened, anyone can then pay into it up to the tax-free limit. This can be a lump sum or monthly contributions.

Parents with CTFs in place can take advantage of the increase to have as much money sheltered before considering transferring the money into a Junior ISA from April 2015.

For every ethical Junior ISA opened through our partnership with The Children's Society, we donate £50 towards the charity's invaluable work supporting the country's most vulnerable children. For example, the £100 raised when two Junior ISAs are opened could pay for a family to have mediation sessions to try and resolve conflict at home.

Find out more

Please read more about opening an ethical Junior ISA.

By Hannah Loney - Guest bloggers

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