Children's bonds

There are a variety of methods of investing for children even though the government has recently stopped its contribution to Child Trust Funds (CTF’s). Children’s bonds also known as children’s bonus bonds are one way of investing tax free for your child’s future.

They work by an adult investing a lump sum in the child’s name and they pay interest annually and then a further bonus at the end of a five year period. Both the interest and the bonus are fixed so these represent a safe and low risk investment vehicle for your child.

The drawback with children’s bonds are that the rate of interest is low and also fixed so if interest rates rise during the term of the bond your rate will not rise in line. Also, if you withdraw funds you will not qualify for the bonus. There are also a number of options for savings for grandchildren that work in a similar way to provide low risk but fairly low return investments.

	The top ten fixed rate savings bonds for 2013 We countdown the highest paying fixed rate savings bonds whether you are looking to save for one year or up to five years.
	Virgin Money launch new fixed rate cash Isas and savings bonds Virgin Money has launched a range of fixed rate cash ISA and savings bonds products paying up to 3.0 per cent.
	Skipton's fixed rate savings bonds and cash ISAs pay up to 3.0% The Skipton Building Society has upped the rates on its fixed-term savings bonds and launched a new range of fixed rate cash ISA products.
	Leeds BS unveil fixed rate savings bonds paying up to 2.50% The Leeds Building Society has unveiled a range of new fixed rate savings bonds that offer investors a higher rate of up to 2.50% or 2.27% if they want to receive a monthly income.
	Co-op offers fixed rate savings bonds paying up to 3.0% The Co-operative Bank has unveiled a range of fixed rate savings bonds, available from between one to three years, paying up to 3.0 per cent.