National Savings

Another option is the National Savings Children’s Bonds.

  • These are a 5 year term investments where the interest rate is fixed and guaranteed for five years at a time.
  • There is a new issue each time the interest rate changes. Investments between £25 and £3,000 per child per issue can be made.
  • The child is the owner of the bond, but they don’t take control of the money until age 16. Bonds should be cashed in by age 21 as they don’t earn interest or bonuses past that age.
  • Applications can be made online, by post and by phone.
  • Early encashments will be subject to a 90 days loss of interest penalty.

Children’s Bonus Bonds pay interest tax free.

Current rates payable by National Savings are 2.50% AER (including a 5th anniversary bonus)

Parents or Grandparents should consider Junior ISAs as an alternative to National Savings.

Contact us for further information.