MARTIN Lewis’ Money Saving Expert has issued an urgent warning to parents to avoid their children missing out on thousands of pounds.
The savvy saver has issued new guidance on Junior ISAs – helping parents save for their child’s future.
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Up to £9,000 can be placed into a Junior ISA (JISA) in the 2023/24 tax year, which ends in April next year.
Funds place into the JISA remain inaccessible for the child until they turn 18, at which point it becomes a standard ISA and the money is theirs.
The £9,000 sum can be split however if preferred between two types of JISA accounts, the money-saving team reports.
A junior cash ISA comes with a “defined amount of interest”.
But the team warns the funds will not grow as quickly as inflation – meaning parents could miss out on thousands in interest.
The money can also be placed into junior stocks and shares ISAs, though the return depends on the performance of the stocks or shares that have been invested in.
The guidance also says the younger a child, the more likely investing will be more profitable than saving.
Money Saving Expert recommends Coventry Building Society as its top pick for a junior ISA, followed by Tesco Bank.
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It comes after a Martin Lewis fan last week revealed how they got £1,100 in just eight months from major banks.
The customer revealed how he got the cash simply by switching bank accounts.
MSE also this week issued a warning to anyone earning less than £220 a week.
In the latest MSE newsletter, the team encouraged people on a low income to check if they qualify for pension credit.
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