One mum has shared her trick on how parents can save up a whopping £40,000 for their child to collect when they’re 18. Laura Turner shares her saving and investing tips with her 26,000 followers on Instagram
Most parents would love to build up a nest egg for their child to cash in when they’re older.
However, with the cost of living crisis rumbling on in the UK, a lot of people are finding it hard to have any savings whatsoever.
But one mum has shared her trick on how parents can save up a whopping £40,000 for their child to collect when they’re 18.
Laura Turner, known as @thriftylondoner on Instagram, shares her saving and investing tips with her 26,000 followers on Instagram. And thousands have liked one of her latest post, where she talked about the eye-watering nest egg.
The reel saw Laura looking at prams as overlay text read: “How to give your baby £40k when they turn 18-years-old.”
The influencer then told followers they should invest the weekly child benefit allowance (£1,331.20 per year) into a Junior Stocks & Shares ISA. She claimed that “based on a. 5.5% average return rate, these contributions could grow to £40,973 by they time they leave home”.
She then added that it could be even more, continuing: “With a 7% average return rate? It’s £48,060.”
Following up in the caption, Laura said: “Gifting your little one a £40k nest egg?! Currently the Child Benefit allowance is £25.60 per week (£1,331.20 per year) for your oldest child.
“If you were to invest that allowance from birth to 18 years old into a Junior Stocks & Shares ISA, that money could grow exponentially.
“Whether you then choose to gift them that money towards university, a first home, a business (or whatever hopes and dreams they have!). It’s certainly money that will stand them in good stead for the rest of their lives.”
The money influencer then added: “Of course, it goes without saying that it’s not always possible to forgo spending your child benefit allowance. But if you are able to? Investing the allowance is certainly an alternative to consider.”
Laura added a disclaimer to her post though, saying: “This is not financial advice. Investments may go down as well as up, and capital is at risk.”
Despite the post being liked by more than 3,600 people, many people were left angered over the advice. One person wrote: “If you can afford to invest money given to you by hard working tax payers you shouldn’t be receiving it. There are plenty of people who don’t receive a penny from the government and aren’t able to invest like this.”
While another added: “Really? How many families over here do you really think can afford to invest their child benefit allowance instead of having to spend it on clothing and feeding their child/children? I’d say an incredibly small amount currently.”
A third agreed: “If you can afford to do that, do you need that from the government?”
Some people also pointed out you wouldn’t be able to do the same for more than one child, as someone else wrote: “It’s a lesser amount for child 2 and then 3. My youngest has missed out on things like £250 free voucher to start a junior ISA. Not fair on him.”
Despite this, others admitted they are also doing what Laura recommended, as one mum said: “This is what we do, we’re only having one child and it works for us. We didn’t until we felt it was affordable, so like you say it’s understandable to not. I’m also in two minds to tell him whether it exists. Will it make him lazy, thinking he has some money on the way, or would it give him time to plan and decide properly what to do?”
