Christmas presents sometimes last only until Boxing Day but if you contribute to a childs savings account it could make a real difference to their financial future. It is the season for giving and receiving, but parents are often reluctant to ask for cash instead of a present for their child.
However this reluctance could well be misguided. Research published today by the Building Societies Association reveals that nearly half the British public, 44%, have contributed or considered contributing to a childs savings instead of or as well as giving a present. Among parents this figure rises to 60%. However, only one in five parents has ever asked friends or family to do this for their own child.
Brian Morris, head of savings policy at the BSA says: These figures are very revealing. Clearly, many people are happy to contribute financially to a childs future, but only a small proportion of parents have ever asked for money for their own child. Christmas is a perfect time to kick-start a savings habit for your child or grandchild and parents should think about asking friends and family to help build a nest egg.
By the time the Christmas period is over, many toys are unwanted and put away never to be played with again. This year, why not ask your family and friends to give your child something that will last longer than Boxing Day,such as a savings top up. Your children will thank you for it in the long-run.
Asking friends and family to contribute towards a childs savings is a great way to help build a nest egg for the future. Building societies are experts in childrens savings accounts, offering good value rates on cash investments. This means you can save in safety, knowing that unlike stock market investments, the original deposit will always be returned and for childrens accounts interest earned will generally be tax-free.
The Child Trust Fund is also a perfect way to give your child a head start financially. Parents who have not invested their voucher are missing out on interest earned on the account. Topping up accounts makes a real difference. Taking the maximum investment allowance of 1,200 a year tax-free, which could be topped up by parents, friends and family, a cash CTF could be worth 36,000 by the time a child reaches 18 years old.