Five myths about investing for children
By Kirsten Hastings, 22 Aug 16
With the new school year about to start in the UK, Fidelity International’s investment director for personal investing, Tom Stevenson, debunks five myths about investing for children.
“Actually, they can and you can start saving into a Junior self-invested pension plan (Sipp) as soon as your child or grandchild is born. Each child can have a total of £3,600 a year, or £300 a month, saved into a pension.
“Just as with your pension, the government automatically tops up payments you make by 20%, so for your child to have the maximum £3,600 a year, total contributions only need to come to £2,880.
“Our calculations show that that if you were to invest £300 a month into a Sipp just for the first 18 years of their life (even if they added nothing themselves during their adult life) they would have a very impressive £603,441 pension pot at the age of 65.
“This is perhaps the ultimate way to make sure your child has the makings of a secure financial future.”
Tags: Fidelity | Investment Strategy
