Children’s Pension
There are many options and products now available, designed specifically for saving for children, one of which is a children’s pension.
It is a happy fact that, unlike people, money grows more attractive as it grows older.
This is certainly true of money enjoying tax-free growth in a child pension fund.
There is an old saying among pensions experts that ‘It’s the first pound that makes the most money’. Therein lies the secret of a children’s pension fund. With that in mind – if the notion of pensions for children sounds strange to you, it may be time to think again.
We all accept that a pension is a great and tax-efficient way of saving for our own future, and we know that savings earmarked for your retirement are best placed in a pension fund, to take advantage of government tax relief and tax-free growth. That also applies to saving for our children!
Start saving into Children’s Pension for your child today
You can start a pension fund for your child with as little as £20 a month, but you may pay in up to £2,880 per year. This maximum amount would be topped up by government tax relief to £3,600. Paying into a child’s pension fund from an early age will give their retirement fund a huge boost in comparison to those who wait until they are working to start saving. This is because the funds will have longer to grow, and will benefit from government tax relief at 20% from the outset. Therefore, even a modest contribution could make a substantial difference to your child’s standard of living in later life.
Pension funds usually expose your savings to the stock markets, and stock market investments can develop strongly over time. History shows that you should plan stock investment for not less than 15 years - in fact, the longer, the better.
The fantastic truth is that, if you set up a child pension for your little one now, the early contributions you pay in for them during the first 18 years of their life could potentially provide more for them than the pension savings they make themselves, during their working career.
Click here now for Pensions Advice or call 0800 678 5929
18042012 – JOR
