Whether you are wanting to help your children in the future with a house deposit, wedding or to provide them with funding to pay for university, saving for your children can help them get off to a flying start.

Teaching young people the value of savings can also lay the foundations for a wealthier, more independent life when they reach adulthood.

Maximising ISA allowances is one way to save for children. A Junior ISA (JISA) can be opened for a child up until their 18^th birthday, per current rules, with an annual subscription limit of £9,000 in the 2022/23 tax year. Once opened by a parent or guardian, anyone can contribute to a JISA.

A JISA can either be held as a Cash ISA, similar to a normal savings account, although the money cannot be withdrawn until age 18. There is also the option of a stocks and shares JISA, which can invest in a range of stocks and shares, funds, tracker funds, investment trusts etc. You can split the subscription limit whichever way you like between the two types of JISAs.

Once the child turns 18, the JISA is automatically rolled over into an adult ISA which gets the full ISA allowance of £20,000 per tax year (as at 2022/23). However, a child can open an adult cash ISA once they reach age 16, which will also allow the full annual adult ISA allowance of £20,000.

Therefore, it is possible for a child to hold both an adult cash ISA as well as a JISA from the time between their 16^th birthday and their 18^th birthday. This means that during this period, up to £29,000 can be paid into their ISAs in a single tax year. Over the whole period, this can total tax-free savings of £87,000 in three years!

If you would like to discuss the above further, please do not hesitate to contact a member of our team.