MUM’S THE WORD – SAVING FOR YOUR CHILDREN IN 2023
Giving children a financial flying start, by setting aside money throughout their childhood, is important to many of us.
However, mums are more likely to make financial provision for their offspring, with 60% of those actively contributing to a child’s savings and investments being women*. Researchers noticed that this appears to fit in with a broader theme, where women tend to connect investing to outcomes for their family more than to their own needs.
The research also shows that a tailing-off in contributions happens as children get older. Just over two-thirds (67%) of new parents start investing or saving for their newborns, falling to 54% by the time children reach secondary-school age.
Cash isn’t always king
If you are going to put some money aside for your children, it’s important to make sure that it works as hard as possible for the long term. The research highlights that most savings are held in premium bonds or cash products, such as cash Junior Individual Savings Accounts (JISAs). The JISA allowance has increased over the years from £3,600 a year in April 2011 to £9,000 for the 2023 to 2024 tax year – although currently stocks and shares JISAs make up just 3% of all accounts.
Choosing cash can limit the impact of parents’ savings, especially in times of rising inflation, as the real value of cash will erode over time. Although not guaranteed, investment products have historically delivered better returns over the long term.
We’re here to help
With high inflation continuing to feature in the headlines, we can help make sure the savings you make for your children work as hard as possible for their future.
Article provided by Citrus Financial. For help with deciding on the most effective way to save for your children contact them today on 01732 834834 or email advice@citrusfinancial.co.uk
*Boring Money, 2021
Author: Helen Loder
Co-Director of Sevenoaks Mums