Help my children finance

[Blue_star]

I have 2 very young children. I am scared that if I get planted and my partner replaces me with someone then my children might find themselves in a bad living situation.

I have been feeling trapped as a child and want them to be able to get life on straight keel once 18.

I want to make sure when they hit 18 they have money to rent something in case they need to run away.

Please advice in your opinion on the vessel for the funds and how much.

I got an idea how much I can afford but dont want to influence your advice. Let me know if I am missing something

I also dont want them to reach 18 and blow money on craps as they think they rich.
I am not rich

[FriedMarsBar]

If you're not using your ISA allowance, which is £20 per annum, I'd suggest going this route as that way you can keep control and it's quite simple.
You could even consider a Stocks and Shares ISA which will most likely lead to a better rate of return over 10 to 15 years.

[ThingsBehindTheSun]

Blue_star said:

I

I also dont want them to reach 18 and blow money on craps as they think they rich.
I am not rich

This is exactly what will happen. I gave my daughter £1000 for passing her GCSE as did my mother. She straight away bought an iPhone 15 Pro Max (Her dream phone as she called it) despite me begging her not to. She has had it stolen, smashed the screen and then 2 months later destroyed it by dropping it in water. Luckily the Apple care insurance paid for the last two.

She worked for the whole of last summer and earned £4000. She has now blown virtually all of this on Ubers (would never consider getting a bus), drinking, eating out and various other crap. Hundreds of pounds was spent on driving lessons and other things that she booked and then completely forgot about and didn't cancel.

She is due to get her Child Trust Fund very soon, she will instantly blow that on crap too.

She is off to University in September, I am dreading it as she thinks it is going to party central.

What pisses me off is I work hard for my money and the money she is wasting is basically my money that I gave to her.

They have been left 15% each of my parents money in my parents will, I don't even want to think where that will go when the time comes.

[mikeiow]

I’d suggest a Junior S&S ISA in a global low cost tracker fund.

More important is helping educate your kids. Sorry, but doesn’t sound like TBTS managed that (yet?).

Start with pocket money. At a very young age that is sweetie cash, but try to pitch it that if they wanted a comic, they might have to save a week or two.
Maybe try your own version of the Stanford Marshmallow experiment - some people are spenders, some are wiser!

We got ours accounts with Santander (Abbey back then, I suspect). They could save, and as they got older, their ability to use it grew with them. By Uni age, they get a free student railcard.

At a teenager age, we started giving them a bit more, but THEY had to buy their non-school clothes. Suddenly the Superdry tops their friends all had we less desirable when it was all their savings.
Define jobs that can earn them a bit more.

Talk about money with them: income, tax, wages, mortgages. My parents generation never really did, & when I was young money was like water, flowed in and out as I earned it.

If they don’t understand the link between effort & reward, I guess it is an uphill battle for them through life. Maybe they will earn it as an influencer

[ThingsBehindTheSun]

mikeiow said:

I

At a teenager age, we started giving them a bit more, but THEY had to buy their non-school clothes. Suddenly the Superdry tops their friends all had we less desirable when it was all their savings.

That certainly isn't my experience, what is annoying is the amount of clothes they buy online, don't like/don't fit so they and they just leave on the bedroom floor.

They did return some White Fox clothes, but as they don't refund they ended up with hundreds of dollars in their White Fox accounts that they couldn't be bothered to spend.

As someone who would never let any refund go, no matter how small, it boils my piss.

[alscar]

Start off with some form of either S&S ISA or perhaps Investment Trust Funds held within an ISA.
They can be in the child’s name generally until they reach 18 with yourself as Trustee.
Kick start with as much as you can / want to fund with and then top up as and when you can.
Alternatively fund in your own name but make sure your will is clear as to age of acquirement and what you are leaving specifically them if you go that route.
You may want to think about this in any event.
In the meantime as said already try and educate them in financial matters as much as is realistic.

[drmike37]

FriedMarsBar said:

If you're not using your ISA allowance, which is £20 per annum, I'd suggest going this route as that way you can keep control and it's quite simple.
You could even consider a Stocks and Shares ISA which will most likely lead to a better rate of return over 10 to 15 years.

This is the correct answer.
Along with some financial education for them. And if you’re really worried about what your wife will do as soon as you die, you’ll need to set up a trust in your will and make sure someone other than your wife knows about it!

[Zigster]

Sounds like a need for life insurance to me, with some way of restricting how it is paid out.

[997.1]

I think regular saving into a low cost tracker fund will be best over a decent period (read 15-30y)

Time in the market be timing the market

Why are you so anxious though?

[BoRED S2upid]

The only way you can prevent them blowing the money at 18 if through education teach them the value of money and not to be an idiot.

The means dripfeed into a S&S isa over 18 years and forget about it.

[Drezza]

I'm thinking about setting up a high-risk portfolio S&S ISA for my two nephews as a surprise gift when they're 18. Something like a tenner a month to each set and forget. Maybe something like that but more than a tenner a month.. If they turn out to be little turds I can keep it for a motorbike fund instead.

[Simpo Two]

ThingsBehindTheSun said:

I gave my daughter £1000 for passing her GCSE as did my mother. She straight away bought an iPhone 15 Pro Max (Her dream phone as she called it) despite me begging her not to. She has had it stolen, smashed the screen and then 2 months later destroyed it by dropping it in water. Luckily the Apple care insurance paid for the last two.

She worked for the whole of last summer and earned £4000. She has now blown virtually all of this on Ubers (would never consider getting a bus), drinking, eating out and various other crap. Hundreds of pounds was spent on driving lessons and other things that she booked and then completely forgot about and didn't cancel.

She is due to get her Child Trust Fund very soon, she will instantly blow that on crap too.

She is off to University in September, I am dreading it as she thinks it is going to party central.

What pisses me off is I work hard for my money and the money she is wasting is basically my money that I gave to her.

That's a sad story. Unless she's lucky she'll be working until she's 70. I would stop giving her money so hopefully she comes to view it as a finite resource.