Alternative to childrens ISA?

[ColdTeaAgain]

We are new parents and naturally want to have a savings account for our little one. Grandparents have opened a childs ISA which they would to use as their own savings fund for DD. This is fine, they are free to do as they wish. But for our own savings for DD, I'm a little uneasy with the idea of DD having access when 18 just in case the money does not get spent wisely! She would have access to the grandparents fund so I think I'd like to keep control of the rest of her savings until we decide its appropriate for her to have it. Hope that doesn't sound mean!

Does anyone else feel the same? Are there any good alternatives to a childrens ISA?

[agnesf]

I agree with your concerns re child ISAs. Also one of my DC has a child trust fund which was available before a child ISA and the money is now stuck in it and it is paying almost zero interest.

I spent ages mucking about with children's accounts and have come to the conclusion that they are a complete pain in the neck and not worth the effort. If its an account in a child's name you cannot do anything wiht it unless you go into the branch. I worked out that the amount of money and time I spent on driving to the different banks, parking etc etc was more than the interest it was earning. You hardly get any tax advantage from it being in a child's name - just the first £100 of interest is tax free.

I would advise just saving your own money in a cash ISA and keeping your own account of how much you think should be designated for your child. Then when she is old enough i.e 18 or whatever, either write her a cheque for the amount that has accumulated over the years.

[cakesonatrain]

Interesting, as we have been wondering the same.