Putting money aside for your children is something most parents want to do as it guarantees them a degree of financial independence once they become an adult. Depending on how much you are able to save, the nest egg can be used as a deposit for a house or a car, reducing the financial pressure they are likely to face.

But with the cost of living crisis showing no signs of stopping, it may be tempting to wait until the economy starts to improve. However, saving for your child's future doesn't need to be expensive; the key is to save regularly, then sit back and watch the money build up over time. For example, if one person saves one pound a week from when a child is born until it turns 18, they will earn £936. If two people contribute to the account, each saving £2 per week, the total will rise to £3,744. For those eager to save larger amounts, the easiest way to go about it is with a junior ISA.

What is a junior ISA?

Junior ISAs allow you to save a certain amount each year for your child and are available from many credit unions, building societies and banks. They are tax-free savings accounts that can be opened by a child's parents or guardians, who manage the account until the child turns 16. However, the child cannot access their money before the age of 18.

Once an account has been set up, anyone can pay money into it but the total amount paid in cannot exceed a certain limit; for the 2022-2023 tax year, the maximum amount that can be paid in is £9,000.

There are two types of Junior ISA: cash ISAs and stocks and shares ISAs. With Cash ISAs, you don't pay tax on interest on the cash you save; with a stocks and shares ISA, your cash is invested and you don't pay tax on any capital growth or dividends you receive.

What are Junior Saver accounts?

Another option for people who want to save money for their child's future are Junior Saver accounts. Junior Savers enable you to save for your children straight from your pay via Payroll or Direct Debit, with whatever you pay into the account earning an annual dividend.

Unlike ISAs, there are no limits on the amount that can be paid into a Junior Saver account - just a minimum deposit of £5 per month - making it a great way to save small or large amounts.

We help you save for your child's future, today with our Junior Saver account. At Harlowsave anyone with one of our Junior Saver accounts also receives free life savings protection of up to £10,000 and Financial Services Compensation Scheme (FSCS) Protection of up to £85,000.