This is a money makeover post for my kids, any advice welcome!
Number and age of children: 2 young kids, both lower primary school
Annual gross income: they each receive Eur 6k as gifts from family members each year.
Summary of Assets
Credit Union; about Eur 500 each in their own accounts from cash gifts, earned doing chores etc. Available for their own spending if they want it for a school tour, bike etc.
An Post: Eur 5000 each in their own names. 10 year term. Tax-free, no admin.
Insurance Company fund: E35,000 each. This was a gift and is invested in a fund which is in trust with the parents' names as trustees.
We can't add any more funds to this as it was a lump sum investment. We would have to open a new trust each time to invest further. This is subject to exit tax.
Ulster Bank: approx E45,000 each. These accounts are building up as this is where I put the E6k each annual gift. We add E100 most months also. These accounts will be closed by UB shortly.
What specific question do you have or what issues are of concern to you?
Question: where to put the kids' Ulster Bank money?
Since we (the parents) are both working, I hope to pay college and other expenses ourselves. I don't want the kids to have access to the Ulster Bank money for ~15 years at least. I would like a product we could top up annually or monthly if possible.
Thoughts:
1) The insurance company investment fund is a bit of admin to set up a new trust and fund each year. But I would consider it as a once off again. I'm not sure what happens when they turn 18 either. It's not suitable for regular saving.
2) I asked Davy a few years ago and they do a trust for kids which allows you to access investment funds. But Davy have not treated their clients well in the past. However they do look after the paperwork for a bare trust though which is appealing and you can add to it monthly I think.
3) I thought about buying an asset like farm land to rent out, but I think the income would then be considered the parent's income or the gifting party's income I presume? This would have to be via a trust as well, plus we can't add to it annually either. It would be a once off so I suppose it's not a runner.
4) The easiest option would be An Post but the returns will not be good due to inflation and the current low rates.
5) The UB accounts are in the kids' names already with parents listed as a contact or allowed to transact on the account (the adult name is listed on the child's statement as far as I remember). I thought about putting it in De Giro in parents names and buying a non-distributing ETF, with an ad-hoc trust drawn up (as was recommended on another thread). I would prefer to keep it in the kids' names and officially separate as we (the parents) have a De Giro account already. Should I try setting up "official" bare trusts and talking to a solicitor about the paperwork to keep it ring-fenced?
Any recommendations or advice please? Thanks in advance.
Number and age of children: 2 young kids, both lower primary school
Annual gross income: they each receive Eur 6k as gifts from family members each year.
Summary of Assets
Credit Union; about Eur 500 each in their own accounts from cash gifts, earned doing chores etc. Available for their own spending if they want it for a school tour, bike etc.
An Post: Eur 5000 each in their own names. 10 year term. Tax-free, no admin.
Insurance Company fund: E35,000 each. This was a gift and is invested in a fund which is in trust with the parents' names as trustees.
We can't add any more funds to this as it was a lump sum investment. We would have to open a new trust each time to invest further. This is subject to exit tax.
Ulster Bank: approx E45,000 each. These accounts are building up as this is where I put the E6k each annual gift. We add E100 most months also. These accounts will be closed by UB shortly.
What specific question do you have or what issues are of concern to you?
Question: where to put the kids' Ulster Bank money?
Since we (the parents) are both working, I hope to pay college and other expenses ourselves. I don't want the kids to have access to the Ulster Bank money for ~15 years at least. I would like a product we could top up annually or monthly if possible.
Thoughts:
1) The insurance company investment fund is a bit of admin to set up a new trust and fund each year. But I would consider it as a once off again. I'm not sure what happens when they turn 18 either. It's not suitable for regular saving.
2) I asked Davy a few years ago and they do a trust for kids which allows you to access investment funds. But Davy have not treated their clients well in the past. However they do look after the paperwork for a bare trust though which is appealing and you can add to it monthly I think.
3) I thought about buying an asset like farm land to rent out, but I think the income would then be considered the parent's income or the gifting party's income I presume? This would have to be via a trust as well, plus we can't add to it annually either. It would be a once off so I suppose it's not a runner.
4) The easiest option would be An Post but the returns will not be good due to inflation and the current low rates.
5) The UB accounts are in the kids' names already with parents listed as a contact or allowed to transact on the account (the adult name is listed on the child's statement as far as I remember). I thought about putting it in De Giro in parents names and buying a non-distributing ETF, with an ad-hoc trust drawn up (as was recommended on another thread). I would prefer to keep it in the kids' names and officially separate as we (the parents) have a De Giro account already. Should I try setting up "official" bare trusts and talking to a solicitor about the paperwork to keep it ring-fenced?
Any recommendations or advice please? Thanks in advance.