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Angel's Delight

Do you ever struggle to find that latest must-have present for your child, grandchild or other youngster when their birthday comes around? Then read on for details of the best present anyone can bring to any child under the age of 18!

This particular present is portable, it can grow in value, it can change a child’s life, and it’s something they will be able to remember you by.

Is it the latest video game, toy or electronic gadget? No – it is something much more valuable and enduring.

This gift is so flexible it can be used in many ways.

Imagine, 18 years from now, a baby you know who has become a strapping young man or a beautiful young lady, who receives from you a gift that is far more lasting than the latest electronic gizmo that will quickly be forgotten or outmoded.

From November 1 2011, friends and family of anyone below the age of 18, have been able to become a guardian angel. How? By gifting up to £3,600 a year, until that child reaches the age of 18.

These investments can be placed in many environments, from lower risk Bank and Building Society-type deposit accounts, through to a more complex share portfolio. The gift can be made on a regular or single premium basis.

This new investment is called a ‘Junior ISA’.

The Junior ISA can be the ideal vehicle to save up for anything from university fees – now £27,000 or more – to a deposit on a house. For example, if a generous grand-parent were to gift the full allowance of £3,600 every year, and if we assume a growth rate of 5% compound each year, depending on charges, this could grow into a tidy sum in the region of £100,000!*

Don’t worry if you can’t afford the full allowance - you can also make regular contributions of lesser amounts to a Junior ISA.

This process of making such a gift can also be used as part of a wider Inheritance Tax (IHT) mitigation strategy, meaning the fairy story will have a happy ending, as this will defeat the nasty tax-man. It means an angel – like you – can make a substantial gift each tax year, and that gift will be excluded from your estate should you pass away. (You could also make a gift out of your regular income, providing it is not detrimental to your standard of living. These gifts can also be exempt from the tax collector.)

This type of giving is a lot easier than having to go to the shops and spend hours wondering what to buy – what’s in, what’s out, what brand and colour it should be – and it avoids the hassle of having to wrap it up and running out of sticky tape!

You can take the stress out of gift shopping, and you can buy something far more valuable for those younger you.

There may not be an excess of joy on the face of the child when they open your card, instead of a carefully-wrapped game or toy, but when that same child is fully grown and stands upon the threshold of adulthood, they will remember what you have done, and your gift will be a valued legacy that will endure for far longer than the excitement of playing a video game.

Your gift can be the very foundation of the start of a young person’s life. Why not bring your own ‘Angel’s Delight’ to those you value and cherish?

Arwyn Bailey is a member of ACFA, the Association of Christian Financial Advisers. ACFA aims to be the voice of Christian financial advice and champions best practice in the UK. The ACFA website offers links to Christian financial advisers across the UK.

*According to Fidelity Fund Managers and assuming a growth rate of 5% per annum, the total amount payable after 18 years would be: £101,336.00.

Arwyn Bailey - arwynb@justamo.com
Published in 'Families First', February 2012