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Savings & Investments

The importance of planning for your child’s financial future.

Written by Laura Robinson on 15th January 2024 Time to read: 2 minutes

Have you considered family financial planning? It’s never too late to invest and start your planning and budgeting journey; a little time and effort will go a long way for you and your loved ones.

Sharing your wealth during your lifetime – especially with younger generations facing the pressures of rising house prices and university fees – can really make a difference.

A good place to start could be thinking about what you’d like for your children. They might be too young to have their own goals but once they reach adulthood, a financial boost is bound to be useful.

For some families, it may not be easy to balance long-term and short-term goals, plan for unexpected costs, and manage daily expenses at the same time. However, as with all investing, the earlier you start, the better.

Here’s what you need to do to help plan the financial future for your family in the best way.

Sections:

Setting a long-term savings plan

As they require more time, commitment and discipline, long term savings goals can be tricky to plan for and even trickier to achieve.

Whatever stage of life you’re in, it’s good to set some longer-term financial targets. Many people find it helpful to have a goal in mind to focus on what’s important. Goals can help to motivate you to make “sensible” decisions when you feel tempted to buy something that you could probably do without.

But to keep you motivated, it needs to be the right goal for you.

Goals can help to motivate you to make “sensible” decisions.

Setting up a direct debit can help you get into the habit of regular saving, while not being distracted by it as much.

Having different pots of money set aside for saving into can also help, whether that covers holidays, childcare, education fees or Christmas.

Investments for your children

Junior Individual Savings Accounts (ISAs) are long-term, tax-free savings accounts for children. Are junior ISAs worth it, you may ask? Well, they are a tax-efficient way to invest up to £9,000 each year for each child you are a parent or guardian to. You won’t pay Income Tax or Capital Gains Tax on the money inside the Junior ISA, no matter how much it grows.

You remain in control of the investment until your child reaches their 18th birthday, at which point the money belongs to them.

It can be a great way to help fund a deposit on a house, or even pay for school fees.

Investments for your children

House Deposit

Larger pension

Three Great Reasons to set up a JISA for your child

A children’s pension is also a tax-efficient product to save into. There’s no minimum age on when a child can have a pension – only a parent or guardian can open a pension for a child, but once it’s up and running, anyone can contribute.

Childs Pension

2023/24
Contribution		 20%
Government Boost
Up to £2,880 £3,600

You can pay up to £2,880 into a child’s pension for the 2023/24 tax year. When you consider the 20% in tax relief from the government, this adds up to £3,600.

Watch our video to get expert insights on managing your savings, and investing for a secure future for your family.

Tell us your financial goals and we could help you achieve them.

Find out more

Capital at risk.

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True Potential Wealth Management offers restricted financial advice. Our service is specifically designed for clients wishing to access their financial affairs online.

With investing your capital is at risk. Investments can fluctuate in value and you could get back less than you invest.

Tax is subject to an individual’s personal circumstances, and tax rules can change at any time.

True Potential Wealth Management LLP is authorised and regulated by the Financial Conduct Authority, FRN 529810. www.fca.org.uk

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