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Saving – it’s a young one’s game

Saving – it’s a young one’s game

Category: Savings

Updated: 25/01/2011
First Published: 10/09/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

With the costs of living for the next generation increasing at a break neck speed, it is more important than ever that youngsters start saving as early as possible.

The cost of life events, such as going to university, have soared in recent years.

Students starting at universities up and down the country expect to graduate with around £25,000 worth of debt, and costs are only likely to rise.

Similarly, the finances involved in buying one's first home have mushroomed.

The National Housing Federation estimates that first time buyers will now have to wait until they are aged 43 before they can settle down in a home they can truly call 'theirs'.

And in other parts of the country, buyers could be forced to wait until their 50s.

When you consider all the other costs of youth – driving lessons, looking sharp and having a good time – it really does pay to get them saving young.

This issue has become even more pressing since the Government announced it was to withdraw the Child Trust Fund scheme from the beginning of next year as part of its efforts to reduce the colossal budget deficit.

The emphasis to begin creating a nest egg for the young ones has been well and truly switched from Government to parents.

However, the good news is that there are a number of savings accounts especially designed for young people.

Even squirreling away a small amount a month can add up to a tidy sum by the time the children reach 16.

Just £20 a month for 16 years adds up to £3,840 before interest, by no means a trifling sum.

The Best Buy tables set out a number of the best children's accounts in the savings arena. Compare Childrens High Street Savings Accounts

They include the Little Rock Fixed Rate Bond Issue 2, an exclusive account for savers aged under 16, that pays a fixed rate of 4.00% on funds until 1 October 2013.

The account can be opened with just £1 and has a maximum deposit limit of £20,000, while an adult must be named as a trustee.

With the combination of a great rate and ease of use, the decision to take out the account should be child's play!

Read our Changes to Child Trust Funds Guide

Download FREE Child Savings Plan brochures

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.