Here we review the five best online investment services — usually referred to as platforms — for Junior ISAs (JISAs). You can currently invest up to £9,000 into a JISA each tax year and any growth of the money you put in will be sheltered from income tax and capital gains tax. The child can access the money in the account from age 18, and they can manage their savings and investments from age 16.
The old adage that time in the market is better than timing the market is particularly relevant when it comes to investing for children. The sooner you get started, the more chance you have for compound interest to work its magic and turn your kids into millionaires (or pay their exorbitant university fees).
So, whether it’s your child, grandchild, niece or nephew, a Junior ISA is a fantastic way to start them off on a solid financial footing.
What to look for?
Cost
Most platforms will charge small fees for Junior ISAs because of the nature of the accounts. This might be a flat fee like £25 or £50 per year, or a percentage of how much you have invested, such as 0.2% of £10,000 which would equate to £20. There may also be additional costs, depending on which investments you choose and if you change your investment choice.
Investment choice and research
If you’re new to investing and a little unsure you might prefer a platform that has recommendations, or tools that you can use to research your chosen investments. You can also see how different platforms stack up by using our free and easy-to-use comparison tools.
Accessibility
Until the child reaches the age of 18 anyone can invest money into the ISA. Therefore, it might be important to pick a platform that allows you to easily set up payments from friends and family.
App-based
Some platforms have a mobile app, while others are designed to be used on desktop. If you want to check and review the investments on the go then this is something to think about.
Fidelity Personal Investing
Fidelity’s DIY (do it yourself) platform is one of the cheapest on the market and doesn’t charge for Junior ISAs. The platform is well equipped with a range of investments, top fund lists, model portfolios and guidance.
You can start investing with a minimum lump sum investment of £100 or pay in at least £25 a month. However, you might be charged for trading in equities and funds at a minimum of £90 per year.
Vanguard
The Vanguard platform is one of the UK’s most popular, and one of the cheapest on which to run a Junior ISA. The limitation of the platform is that it only offers Vanguard funds and ETFs, and it doesn’t offer shares. Vanguard’s Junior ISA has an account fee of 0.15%, capped at £375, plus fund management fees ranging from 0.06% to 0.79%.
You can start investing with a £500 lump sum or £100 a month.
AJ Bell
AJ Bell is one of the best-known platforms in the market and offers clients a wide range of products and support. The platform has a wide range of investments and is low cost. It has an annual fee of 0.25% for the Junior ISA, plus charges for dealing shares. It also has a range of investment tools and readymade funds to help those looking for some inspiration.
You can start investing with a £250 lump sum or £25 a month.
Nutmeg
Nutmeg offers robo-advice and is one of the longest standing providers of this type in the UK. The platform offers four different investment styles, including a Socially Responsible option. The charge varies between styles as some are regularly monitored and rebalanced, and others are just reviewed once a year.
You can start investing with a minimum £100 deposit and fees range between 0.65% and 1.11% a year. This depends on the style of investing you choose.
Hargreaves Lansdown
Hargreaves Lansdown is one of the oldest and best-known DIY investment platforms in the UK. It comes with a huge range of investment research, guides and investment lists to help make investing easy and intuitive. It has removed all platform and dealing fees on its Junior ISA, taking it from one of the more expensive options to one of the most affordable, especially for those making regular trades.
You can start investing with a £100 lump sum or from £25 a month.
What’s next?
Helping a child take their first step in savings is one of the greatest gifts you can offer. Our free and easy-to-use comparison tools will help you get started!
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