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.
“This is another fallacy and the good news is that you won’t. While parents who save or invest money on their children’s behalf can face a tax bill if their child’s savings or investments earn more than £100 in any tax year, the same does not apply to you when you’re a grandparent.
“Given the length of time ahead of them, investments in funds are especially worthwhile for children. You invest in your name then add the child’s name or initials to the account so you can ‘designate’ or identify which assets are theirs.
“Then you can transfer the assets to the child when they reach age 18. Unlike Isas and pensions, any investment growth will be subject to capital gains tax but this can often be offset by the child’s tax allowances.”
Tags: Fidelity | Investment Strategy
