Open a Child Savings Account for a Lump Sum Payout
Children grow up fast which means it is important to look at saving when they’re young. By saving from just £10 to £25 a month with Scottish Friendly’s Child Bond while they are children you could give them a head start for when they are older. Situations where this might prove useful might include helping to pay for university fees or making a payment to secure a residence.
You can invest in a tax-free savings plan for any child with a Scottish Friendly Child Bond. It’s tax-free because it’s a friendly society savings plan, which means that under current fiscal law it grows free of income or capital gains tax. It certainly is a wonderful way for parents, grandparents, family members and friends to make a big financial difference when the little ones are older.
Put succinctly the Child Bond is a with-profits investment plan: It invests for long-term growth as well as a degree of security, in stocks and shares, fixed interest funds and cash.
Money accrues by means of the addition of potential yearly bonuses and at the specified time the bond matures there’s a tax-free payout. The value of bonuses will be based on on how much profit we make and how we distribute it.
It is important to bear in mind that bonuses are not guaranteed.
The Child Bond can last for a minimum of a decade, but you can invest for longer if you choose to – perhaps to coincide with an 18th or 21st birthday. You can save either monthly, annually or with a lump sum payment.It is completely up to you. It should be borne in mind that if the plan is cashed in at a point prior to the end of the term, the amount the child will get back may be less than the amount paid in.
If you want the monthly option, you can make a start by saving from as little as £10 a month – up to a maximum of £25 per month. Or you can make once a year payments of up to £270 a year.
You can also take care of all of the premiums in one go through our lump sum funding plan. If you invest the maximum permitted sum of £2,340 for ten years, this actually invests £270 a year into the Child Bond – making twenty seven hundred pounds in total. The minimum lump sum of £1,040 will yield £120 a year for 10 years – a total of £1,200. This provides a means for you to make payment of all your premiums in one go and is extremely popular with grandparents who like the reassurance of knowing all premiums for the whole term of the plan are taken care of.
As an added bonus, so you should consider if this is appropriate for your financial needs.
