Home | Finance | Banking
Everybody wants to give their children the best possible start in life, and make their future as secure as possible. Two ways of helping them, money-wise, are by encouraging them to save with their own bank account, and by making investments on their behalf. Children's Accounts Most high street banks offer children's accounts, usually a straightforward bank account with a moderate interest rate. These often come with incentives like free piggy banks that are intended to help children develop a sense of responsibility and prudence about money from an early age. You may like to give your child a financial education by opening them their 'own' account - though there's nothing to stop you using a normal adult account with better rates of interest. National Savings The Children's Bonus Bonds are a tax-free savings account specifically aimed at children. You can invest between £25 and £3000 a year for five years and get guaranteed interest, plus a bonus. Many people choose to give Premium Bonds as gifts for children's birthdays. If they win, it could give them the best present ever! Child Trust Bonds The government have introduced a special scheme to give children a savings account from the very beginning. Any child born after 1st September 2002 is entitled to a voucher worth £250 to be invested in a savings account. Visit www.childtrustfund.gov.uk for details. It's a good idea to invest for your children's' education as early as possible - whether that means private school fees or supporting them when they go into higher education. Long term investments, such as bonds with a ten year term, are a good choice for this purpose. Children are taxed in the same way as adults, and have their own personal tax allowances. If you give money or assets to your own child and it produces an income of £100 or over, the income is counted as yours and taxed at your top rate. You can avoid this rule by choosing investments with tax free returns or capital gains, rather than income. If people other than parents give gifts then the income counts as the child's own, and in this case it's a good idea to ask grandparents or relatives to send a letter or card with any money gifts. That way you have proof of whom the money came from in case the tax office demands it. For a detailed explanation of children's tax issues, look up the Inland Revenue's website at www.hmrc.gov.uk
Information and Articles: http://www.mastersmba.com
Providing Information on various topics, please browse our other Articles for more informative resources, we house information on every topic imaginable so regardless of your needs you can be assured to find the answer here. If you wish to reprint this on your own website, simply click the "Web Version" in the right menu, and you are presented with a pre-formatted document to use.
A lot of the information is written by the Master Article team, and published exclusively on the MastersMBA.com website, and we do our best to research all information to ensure it's as accurate as possible. However at times we also publish documents given to us by other sources, we do examine these documents to ensure they are as accurate and correct as possible however at times they discuss highly specialized fields making it hard to authenticate the validity of every fact in the document. These are written by specialists in their respective fields, and we do trust their integrity and judgment however it's always a good idea when doing any research to consult a number of sources and form your own conclusion based on a number of view points.
