Investing for Children
Investing for Children outside of a Junior ISA
If you would like to save for your child outside of the Junior ISA wrapper, then you can utilise any investment fund to do so. Although unit trusts and OEICs cannot be held by any person under the age of 18, they can be designated into the name of a child, which displays the intention to transfer the assets into the child's ownership at the age of 18. This is an excellent way to save for your child's future needs, as the control is maintained by the primary investor until they are happy to transfer the proceeds. Please see our literature library for an Investment Funds application form.
The Government has recently announced plans to phase-out the Child Trust Fund and as such, we can no longer accept new applications. However, existing holders can still benefit from our 2% discount on top-ups into the Child Trust Fund Non-Stakeholder Baby Bond Choice account from the Children's Mutual. We are also able to accept transfers from other providers.
The maximum annual investment allowance has been increased, in line with the Junior ISA, to £3,600.
The Baby Bond Choice account is a non-stakeholder account offering investments from four different fund managers, namely Gartmore, Insight, Invesco Perpetual and UBS. Remember, the value of shares can go up or down, and you can get back less than you paid in.
Funds Available
| Fund Name | CFS Risk Rating (Out of 10) |
CFS Comment |
| Henderson Cautious Managed | 3 |
This fund aims to provide a combination of income and long-term capital growth. Investment will be in a diversified portfolio of equities, bonds and other related investments. Central to the investment process is the flexibility to conservatively adjust the balance between bonds and equities to reflect changing market conditions. 54% of the fund is in fixed interest securities with a further 38% in UK equities and the rest accounted for by money markets. |
| Henderson European Selected Opportunities | 6 |
This fund aims to achieve the highest possible capital growth from an actively managed portfolio of European investments. The investment process is based upon finding companies, the future prospects of which have been underestimated and avoiding those where they may disappoint. |
| Henderson US Growth | 7 |
This fund aims to achieve a long-term return greater than the return typically achieved from North American equity markets. Currently the largest sector holdings is 20% in financials. |
| Insight Foundation Growth | 4 |
This fund aims to achieve long-term capital growth through investing in a representative sample of stocks intended to replicate the returns of the FTSE All Share Index. |
| Insight Evergreen | 7 |
This fund aims to invest in companies across the globe, which meet ethical criteria. It currently has around 50% invested in North American equities. |
| Invesco Perpetual Income | 4 |
This fund aims to achieve a reasonable level of income, together with capital growth. The investment process combines top-down and bottom-up analysis. |
| Invesco Perpetual World Growth | 5.5 |
This fund aims to achieve capital growth from a portfolio primarily of Invesco Perpetual funds. The fund manager aims primarily to deliver performance through stock selection in the underlying funds, rather than through aggressive asset allocation. |
| Invesco Perpetual UK Smaller Companies Growth | 8 |
This fund aims to achieve capital growth with an average yield through a portfolio of investments in UK smaller companies. The investment process combines an analysis of both broad macroeconomic and market trends and individual company-specific developments. |
| UBS Global Allocation | 5 |
This Fund aims to achieve long-term capital growth through active management of a diversified portfolio invested in both domestic and international equities, as well as bonds and units in UK and overseas regulated collective investment schemes. Currently the fund holds 46% in International equities, 34% in UK equities and around 20% in Fixed interest securities. |
| UBS UK Select | 5.5 |
This fund aims to achieve capital growth through a diversified portfolio of UK equities. The largest sector holdings is currently Oil & Gas with around 22% of the fund invested here. |
| UBS Medium Term Fixed Interest | 1 | This fund aims to preserve capital with some capital growth in a portfolio of gilts and debt instruments. It will be predominantly made up of investment grade bonds, but may hold up to 10% in higher risk, non-investment grade bonds. |
Discounts
Unfortunately, we cannot offer discounts on the initial voucher, however we can offer a 2% discount on any lump sum investment of £250 or over and a 2% discount on any regular monthly savings plan. These discounts come in the form of extra shares and act to enhance your child's investment.
There is no personal tax to pay on any growth and the money your child receives when they reach 18 is also tax free as long as they are a UK resident. This is subject to any change in legislation, and dividend income tax credit is not reclaimable.
Forms
Additional Payment - If you would like to make an additional payment to an already existing Children's Mutual CTF Account
If you have any further questions please call or e-mail us and we will be happy to help.
Call us on: 020 7384 7300
Remember! All investments carry some risk. Before going any further, please read the Important Notice below.