# children's saving



## Potter on (6 Nov 2013)

Hi 

I set up a children's saving account with AIB for my son last year, and has been saving children's allowance each month. I got a letter last month advising they will no longer offer the account and it'll be closed this month. (sorry, i cannot remember the exact name of the account, it's the monthly saving, but they lodge the sum annually to another account.)

With interest so low at the moment and also increase of dirt next year, I'm just wondering if there are any good alternatives. I saw 'childcare plus' account in Anpost, tax free. Would this be the best of them all?

thanks


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## RainyDay (6 Nov 2013)

A lot depends on what you want to achieve. Is this a long term savings plan? What is your attitude to risking some of your capital in search of returns that will beat inflation?

Might be worth having a chat with your local credit union for a start.


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## Lightning (6 Nov 2013)

What age is the child? There are different products for those above and under 12. 

The Child Plus account that you mentioned, is a 6 year product, you save monthly for one year and then lock the money for 5 years. A long term. 

The credit union is unlikely to match bank rates.


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## Potter on (6 Nov 2013)

Thanks guys, my son is only 2. So this is really a long term plan, to save for college, I suppose. I'm only looking into deposit at the moment.  Although I know other types of investment might yield better return in the long term.


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## Lightning (7 Nov 2013)

Do you need the account in the childs name or could you have the account in your name? 

Do you have a lump sum to deposit? or just future monthly savings amounts?


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## theresa1 (7 Nov 2013)

10 Year National Solidarity Bond I reckon - worth checking out - if you have a lump sum.

"A child under 16 years of age (as a sole, joint or trust applicant) provided that a parent / guardian gives written 
consent."


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## Potter on (7 Nov 2013)

CiaranT said:


> Do you need the account in the childs name or could you have the account in your name?
> 
> Do you have a lump sum to deposit? or just future monthly savings amounts?



Hi Ciaran,

When the account is closed, I would have a lump sum.  However I will be continue saving monthly amount. It would be ideal, if I can put the lump sum in an account and then monthly amount.  It doesn't matter whose name it's under, I'm just looking for the best yield I can get.  Most banks offer rates under 3 percent, after dirt, probably only get half the interest.  Anpost offer is tax free, but would banks put pressure to government to reduce interest rate?


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## Potter on (7 Nov 2013)

theresa1 said:


> 10 Year National Solidarity Bond I reckon - worth checking out - if you have a lump sum.
> 
> "A child under 16 years of age (as a sole, joint or trust applicant) provided that a parent / guardian gives written
> consent."



Thanks, I'll have a look at it.


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## RainyDay (8 Nov 2013)

Potter on said:


> Thanks guys, my son is only 2. So this is really a long term plan, to save for college, I suppose. I'm only looking into deposit at the moment.  Although I know other types of investment might yield better return in the long term.



Don't forget that inflation will eat away at the value of your savings over time.


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## Lightning (9 Nov 2013)

Potter on said:


> Hi Ciaran,
> 
> When the account is closed, I would have a lump sum.  However I will be continue saving monthly amount. It would be ideal, if I can put the lump sum in an account and then monthly amount.  It doesn't matter whose name it's under, I'm just looking for the best yield I can get.  Most banks offer rates under 3 percent, after dirt, probably only get half the interest.  Anpost offer is tax free, but would banks put pressure to government to reduce interest rate?



Hi,

Best to keep in your name so as you will get a higher return. 

For regular savings, consider the Nationwide UK product that pays 4% AER variable. The product is for 15 months, you will need to switch after 15 months. 

For the lump sum, consider a term deposit with PTSB, where the interest is paid up front, you will pay the 2013 rate of DIRT rather than the higher 2014 rate and it will not be subject to PRSI. PTSB will pay 2.50% AER fixed for 2 years. 

The NTMA State Savings 10 year product is mainly DIRT free but part subject to DIRT and possibly PRSI. 10 years is a long period of time. Rates might go up inside the 10 year period but you are stuck with the product if you want to get the full interest benefit on maturity date.


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