4 Powerful Tips To Skyrocket Your Child’s Life Savings
1. Save little and often - setting up a savings direct debit can take the hassle out of remembering to save. Saving even a small amount each month really does add up over time. The key is to be consistent and save regularly.
2. Start early - The longer you have to save and grow your child’s savings, the bigger the savings pot will be by the time your child hits 18. This is due to the extra time to accumulate savings and the additional years that interest is accumulated on top of this.
3. Invest in the stock market - Compound interest works particularly well when you have a good yearly return on your money. Cash savings accounts have extremely poor interest rates at present (NS&I interest rates recently fell to as low as 0.01%!) On top of this inflation erodes the value of money. As an example, the Fidelity Index Global fund invests in every large company and returned an average of 14% every year over the past 5 years!
4. Save with others - Let others know that you have a savings account for your little ones and that you are actively saving for them - you never know if a generous Grandparent may want to contribute! Another idea is to ask for contributions to the savings account for birthdays and other special occasions. As well as keeping your home clutter free, it will have a material impact on your child’s financial future and ability to pay for education, travel or a house deposit - a much better idea than more plastic toys!