UND-Pilsa Blog

Children reach adulthood fast which means it is important to find out about saving when they’re .not yet adults. By saving from just £10 to £25 a month with Scottish Friendly’s Child Bond now you could give them assistance that will help them when they are older. For example helping to pay for university fees or providing the means to acquire a first home.

You can save tax-free for any child with a Scottish Friendly Child Bond. It’s tax-free because it’s a friendly society savings plan, and as such under current fiscal law it grows free of income or capital gains tax. Without doubt it is a fine way for parents, grandparents, family members and friends to make a major financial difference when the kids are older.

Put succinctly the Child Bond is a with-profits investment plan: It invests for long-term growth as well as an element of security, in stocks and shares, fixed interest funds and cash.

What you put in grows through the addition of potential yearly bonuses and at the relevant time when the bond reaches maturitythere’s a tax-free payout. The value of bonuses is dependent on how much profit we make and how we distribute it. It must be realised that bonuses are not guaranteed.

The Child Bond usually has a duration of for a minimum of ten years, but you are able to invest for longer should you decide to - perhaps to coincide with an 18th or 21st birthday. You can save either monthly, annually or with a lump sum payment.It really is totally up to you. It should be noted that if the plan is cashed in before the end of the term, the amount the child will receive may be less than the amount paid in.

If you opt for the monthly option, you can start saving from as little as £10 a month - up to a maximum of £25 per month. Or you can make once a year payments of up to £270 a year.

You can also make all of the premiums in one go through our lump sum funding plan. If you invest the maximum permitted figure of £2,340 for ten years, this actually invests £270 a year into the Child Bond - a total of £2. The minimum lump sum of £1,040 will yield £120 a year for 10 years - a total of £1,200. This provides a route for you to settle all your premiums at once and is extremely popular with grandparents who like the reassurance of knowing all premiums for the whole length of the term of the plan are taken care of.

This plan includes life cover so you should consider if this is fitting for your financial needs. See also our Child Trust Fund account