14th December 2022

Further questions answered on Junior ISAs

When it comes to Junior ISAs, there are a lot of questions that people have. What is the difference between a Junior ISA and a regular high-interest savings account? How do I transfer my junior ISA? Can I open a Junior ISA for an unborn baby? These are just some of the questions that we will answer in this article. 

First up, can a Junior ISA be transferred?  The answer is yes, a Junior ISA can be transferred. It must be done by the person who originally opened the account and there may be certain restrictions imposed by the provider so it’s best to check with them before you proceed. When the time comes to transfer a Junior ISA, you can only do this if it is transferred to another Junior ISA. You cannot transfer a Junior ISA into a high-interest savings account, for example. 

The next question is does a Junior ISA affect benefits? The answer is no, having a Junior ISA  does not affect any benefits that the child’s family may be receiving (like Child Benefit, for example).  This is because the money in the Junior ISA is not immediately available to the child and will only be accessible when they reach the age of 18.

Can you open a Junior ISA for an unborn baby? No. An investment, like a Junior ISA, can only be opened when the baby is born and is in possession of a birth certificate. So if you know an expectant set of parents you will need to give the gift of investing when the baby arrives!

Another question we get asked from time to time is can you transfer a Junior ISA to a Lifetime ISA?  The answer is yes, you can transfer from a Junior ISA to a Lifetime ISA but only once the child reaches 18 years of age.

Finally, which is better a Junior ISA or Junior SIPP? It really depends on your individual circumstances as there are advantages and disadvantages to both. With regard to Junior ISAs,  the money saved is locked away until the child reaches 18 and can access it, whereas, with a Junior SIPP in most cases, the investment will be locked away until they turn 55 (though the child will take control of the pension when they turn 18). Ultimately, it’s important to do your research and seek professional advice in order to make an informed decision that suits the individual circumstances of both yourself and the child.

We hope that this article has answered some of the less common questions about Junior ISAs.  You can find more information and guidance on the Government’s website or by speaking to a financial advisor, or please feel free to contact our team if you have any questions. We have tried to answer some more of the frequently asked questions about Junior ISAs on our website here

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The website and the information contained therein should not be regarded as an offer or solicitation to conduct investment business in any jurisdiction other than the UK. Past performance is not necessarily a guide to future performance and the value of your investment may fall as well as rise, and any income received in the form of dividends may fluctuate. You may not get back the full amount when the account is closed. If paying regular monthly contributions please bear in mind that if contributions are not maintained you will be less likely to achieve the investment amount that was originally projected.

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