Saving for your grandchildren
Discover how you can help build up a lump sum towards your grandchild's future with Forester Life. Capital at risk.
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A savings account for your grandchild
There’s nothing more amazing than seeing your family grow with the addition of grandchildren. There’s something exciting each day, from hearing their first words, to seeing them in their uniform on their first day of school.
You may enjoy buying them toys or treats, but have you thought about contributing towards their future financially with a savings account. Any money you save on their behalf could be used towards the cost of university, driving lessons, a first home and more. Learn more about the costs of their biggest milestones >
A savings Plan with Forester Life can offer a brighter future for your grandchild, find out more about Foresters >
Options to save towards your grandchild's future
Many customers have chosen to save for their child’s future with us - in a Junior ISA or Child Trust Fund. When you make a contribution to a child’s savings this is locked away until their 18th birthday.
If you have legal parental responsibility for your grandchild, you can become the Registered Contact. The Registered Contact can open a savings Plan or manage an existing Plan . Child Trust Funds can no longer be opened, but existing accounts can be transferred to Forester Life.
The good news is that anyone can contribute to a Junior ISA or Child Trust Fund, any time before the child’s 18th birthday.
The important part: Any gifts cannot be reclaimed and combined contributions cannot exceed the yearly limit of £9,000. The contribution year runs from birthday to birthday for Child Trust Funds and each tax year for Junior ISAs. Tax treatment depends on individual circumstances and may be subject to change in the future. As with all stock market investments the value of a child’s Junior ISA or Child Trust Fund can fall as well as rise. Due to this they may get back less than has been paid in.
Gifts cannot be reclaimed and combined amounts cannot exceed the contribution limit of £9,000, running from birthday to birthday for CTFs and each tax year for Junior ISAs. Tax treatment depends on individual circumstances and may be subject to change in the future. As with all stock market investments the value of the child’s Junior ISA or Child Trust Fund can fall as well as rise and they may get back less than has been paid in.
Junior ISAs
A Junior ISA, is a tax-efficient savings account for adults to save on behalf of a child, until the age of 18. This provides them with a tax-free sum of money for adulthood. Contributing into a grandchild’s Junior ISA can make a big difference to their financial future.
With our Junior ISAs you can invest in a choice of funds or our Shariah compliant fund. You can set up contributions from £10 up to the annual tax year limit of £9,000. Anyone making regular gifts to a Junior ISA with Foresters can create a MyPlans gifters account.
If your grandchild does not yet have a Junior ISA and you think your family would like to save in one, suggest they take a look. For more information, you can read guide to Junior ISAs.
Child Trust Funds
A Child Trust Fund (CTF) is a long-term children’s savings account introduced by the Government. Parents of children born between 1st September 2002 and 2nd January 2011 were given a voucher from the Government to open the account. Parents could then choose a provider, or in the event one was not chosen then one was allocated for them by HMRC.
No new CTF accounts can be opened. If your grandchild has a Child Trust Fund you can still make contributions and their account can be transferred to Foresters Financial. Foresters are one of the UK’s largest CTF providers. You can contribute from as little as £10, with an annual limit of £9,000 running from birthday to birthday. Just like with Junior ISAs, anyone who makes regular contributions can have an online MyPlans gifters account.
If your grandchild was born in the UK between 1st September 2002 and 2nd January 2011 s, it is likely that they have a Child Trust Fund. If they do not know where it is, parents can check if their child's Child Trust Fund is with us.
For more information, you can read our article - 'What is a Child Trust Fund?'
Saving for your grandchild with an ISA
Junior ISAs and CTFs are both long-term savings accounts which offer a financial head start to adult life. But what if you want to save more than the maximum contribution allowance (£9,000)?
With an ISA (Individual Savings Account) you can save up to £20,000 each year. ISAs are a popular and tax-efficient way to invest. There’s no UK tax to pay on any growth and income earned from your investments. You can save from £20 per month, and the allowance resets each tax year allowing you a great way to build your savings over many years.
By saving into our ISA or our Shariah ISA, you have the freedom to give them this money at any time. This means you don’t have to wait until they are 18, or you have the option to keep the money growing for a few extra years. You could get them on the road at 17 with driving lessons or help them buy their first home in their 20s.
The money will be invested in your name. This means you will be responsible for managing the Plan and can withdraw the money whenever you wish. With the option to save a higher amount in this Plan, you could split the money between all of your grandkids. Open an ISA >
With an ISA tax treatment depends on individual circumstances and may be subject to change. As with all stock market investments the value of your ISA can fall as well as rise.
If you want to save above the ISA limit , our Savings & Investment Plan could be an option. Like our ISA this product invests in the stock market and could offer greater growth than a cash savings account. You have the option to invest in our Stakeholder Funds or our Shariah Fund - the same as our ISA. The key difference is there is no investment limit which allows you to save more money.
Unlike our ISA, the Savings & Investment Plan can be opened on a joint basis. You could combine your savings with a partner and both save for your grandchild’s future. You have the option to open multiple Savings & Investment Plans and have these set up for each grandchild. Joint Plans will need to be opened with a Financial Adviser. Request an adviser visit >
Open a Stocks and Shares ISA Open a Savings & Investment Plan
Tax treatment depends on individual circumstances and may be subject to change in the future. As with all stock market investments the value of the Plan can fall as well as rise and you may get back less than has been paid in.
Contributing to a child's savings Plan with Foresters
As the grandparent if you don’t have legal parental responsibility for your grandchild, you can set up a MyPlans gifters account. All you need is the child’s Date of birth and the Plan number (you will need to get this from the Registered contact). With MyPlans account you can see your payment history, fund performance and make a top up whenever you want.
Payments into children’s accounts can be made over the phone, by post or with one of our Financial Advisers. You will need the child’s date of birth and Plan number. What happens to their money at age 18?
If your grandchild has a Junior ISA or Child Trust Fund in their name, they can access their savings at age 18. This includes money you and other family members have saved and will be an exciting milestone for them.
You can learn more about what will happen to their savings at 18 here for a CTF.
Or here for a Junior ISA.
If you want to see how your gift/s will help, we have a Junior ISA calculator and Child Trust Fund Calculator. The calculator will help you see how much their Plan could be worth age 18.
Gifts cannot be reclaimed and combined amounts cannot exceed the contribution limit of £9,000, running from birthday to birthday for CTFs and tax year for Junior ISAs. As with all stock market investments the value of your child’s Plan can fall as well as rise and you may get back less than has been paid in.
What happens to their money at age 18?
If your grandchild has a Junior ISA or Child Trust Fund in their name, they will be able to access their savings at age 18. Even just visualising your grandchild turn 18 is an incredible thought, but this will be an exciting milestone for them and they will be able to access the money you, other family and friends have saved on their behalf.
You can learn more about the importance of their 18th birthday and their savings invested with us here for a CTF or here for a Junior ISA.
