Junior ISA

Whether you are a child wanting to understand your options, or a parent/guardian wondering what is going to happen to the Junior ISA when your child reaches age 18 – we have the information you need.

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A Junior ISA with Foresters

We pride ourselves on looking after over 1.5 million children’s savings Plans and when they reach their 18th birthday we hope that the money saved for them helps their journey into adulthood, but we don’t want it to stop there we want to be therefore the other milestones in their life; saving for their first home, their children and protecting the ones they love.

Our purpose is to help people save, protect their families and give back to our members and the communities they live in.

I would like to know more about my Junior ISA

What is a Junior ISA?

A Junior Individual Savings Account (ISA) is a tax-efficient way for parents/guardians and others to save on behalf of a child. A Junior ISA can be opened for a child from registration of birth up to age 18, a child from age 16 can also open their own Junior ISA.

The Government limits the amount that parents/guardians, family and friends can contribute each year. This is currently £9,000 for the tax year 2020/21.

The money saved by yourself, parents/guardians, family members and friends over the years can help give you the best start to adult life.

What happens when I reach age 18?

When you reach age 18 your Junior ISA will automatically roll into an Adult ISA, where you will then be able to decide whether you would like to

A – Withdraw the money
B – Leave the money in an Adult ISA and continue to save
C – Both A and B

What is an ISA?

An Individual Savings Account (ISA) is a tax-efficient way to save for the future.

You can save in an Adult ISA from Foresters from as little as £20. Our ISA is the only one on the market that gives you the choice to combine both a Stocks and Shares ISA and a Lifetime ISA in one plan.

But before you or anyone else can contribute to your Adult ISA you need to provide us some information so that we can accept the payments.

A Stocks and Shares ISA is a tax-efficient savings account which allows you to save up to £20,000 this tax year. Whether this is saving for the future, a rainy day or something more exciting, our Stocks and Shares ISA could be a great way for you to build up a lump sum.

A Lifetime ISA is available to anyone aged between 18 and 39, and was introduced by the Government to help first-time buyers get on the property ladder and/or to build additional savings for later on in life. The Government offers a 25% bonus added to all amounts invested into the Lifetime element, up to the maximum £4,000 per year, meaning the Government will contribute up to £1,000 each year. However there is a penalty if you encash a Lifetime ISA before the age of 60 when it is not for purchasing your first home. This amounts to 25% of the value of the Lifetime ISA and could mean that you get back less than you have invested.

How will I access the money in my Junior ISA?

You can only access any money saved from age 18. As your Junior ISA automatically rolls into an Adult ISA, you will be accessing your money from an ISA. To access your money you will need to complete an encashment form, which Customer Services will be able to provide you with. Please contact Customer Services on 0333 600 0333 lines are open Monday to Friday 8:30am to 5:00pm.

I have heard about a Child Trust Fund, do I have one?

You may have heard about a Child Trust Fund from friends, or you have received your National Insurance Number from HMRC stating:

“Child Trust Funds
When you turn 16, take control of your Child Trust Fund. Ask your parents or guardian, for more information go to www.gov.uk/child-trust-funds”

If you were born between the 1st September 2002 and 2nd January 2011 you may have been eligible for a Child Trust Fund. In 2015 the Government allowed Child Trust Funds to be transferred to a Junior ISA. Therefore if you now have a Junior ISA your parents/guardians decided to make that transfer. You can only have a Junior ISA or a Child Trust Fund, not both.

I would like to know more about Foresters Financial

Foresters Financial is an international financial services organisation helping more than 3 million customers and members in the UK, Canada and the US, achieve their long-term financial goals.

We are more than a financial services provider; for over 145 years we have helped families build financial security and help each other make a difference in their communities.

We are driven to share, not shareholder driven.

What parents need to know about their child's Junior ISA

What is going to happen to my child's Junior ISA when they turn 18?

The Junior ISA will automatically move to an Adult ISA. Your child will be able to instruct us whether they would like to continue to save, or if they would like to withdraw the money from the Plan – or as mentioned above they can do both. Before we accept any contributions into their ISA after age 18 we will need their instruction.

We know that some parents may have decided to keep this as a surprise for their child and have been saving over the years. Although this is a perfect gift, to help with university, towards a new car or even a new home, don’t let the surprise be spoilt by someone else – start talking to your child about their Junior ISA.

If your child’s Junior ISA was originally a Child Trust Fund, when HMRC provide your child with their National Insurance Number in the letter it will state:

“Child Trust Fund
When you turn 16, take control of your Child Trust Fund. Ask your parents or guardian, for more information go to www.gov.uk/child-trust-funds”

So your child may come to you with some questions about whether they have one, and then ask why they do not have one.

As more children start to receive their National Insurance Number letter, or see the news and information available online about Child Trust Funds this could also ruin the surprise and even maybe cause a little confusion.

Additionally, whether the Junior ISA was originally a Child Trust Fund or not, we legally have to write to the child one month before their 18th birthday to let them know that their Junior ISA will be automatically rolling into an Adult ISA.

I pay into the Junior ISA - Can I still contribute after age 18?

No, after the child turns 18 we will no longer be able to accept any gift payments from family and friends into the Junior ISA. Direct Debits into the Junior ISA also cannot be accepted after age 18, these Direct Debits will be cancelled.

The Junior ISA will roll into an Adult ISA, but before we can accept any contributions to the Plan the child will need to provide us with instruction to do so. Once this has been done you and they will be able to make contributions into the new Adult ISA.

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Information on this page is based on our current understanding and may change in the future. This information will be updated accordingly.