Family Investments, UK children’s savings provider, has witnessed strong demand for its new Junior ISA with just under 6,500 accounts opened since the product was launched on November 1st last year.
They have noticed particularly strong demand amongst existing Child Trust Fund (CTF) holders, highlighting parents’ desire to make equal provisions for siblings who may have missed out on the CTF.
All children born after 2nd January 2011 are eligible for the Junior ISA, but unlike its predecessor the Junior ISA does not come with a contribution of up to £250 from the government to kick start the savings habit. However, many parents have sought to level the playing field for their children with many choosing to add £250 or more to their regular savings to match the government CTF contribution. Parents are engaged with the Junior ISA and this has so far been reflected in the contributions, with the average coming in at around £28 per month compared to the market average of around £24 for Child Trust Funds.
Almost ten thousand parents had enquired about the Junior ISA with Family Investments before it was launched providing a bumper start for the new product, and more than two-thirds of the accounts taken out so far have been opened by mums, continuing the female bias experienced with the CTF.
Despite the strong start to sales, Family Investments believes that both the government and the industry will need to work together to ensure that Junior ISA remains front of mind amongst parents.
John Reeve, Chief Executive of Family Investments said: “The fantastic start we have seen for Junior ISA reflects an underlying demand amongst parents to make a financial provision for their child from an early age. With significant costs, such as university tuition fees or a deposit for a first home to meet, many parents have recognised the need to start saving early.
“Parents have been very receptive to the Family Investments product, particularly as our low minimum premium of £10 per month makes it accessible to all families. We have designed our Junior ISA to appeal to busy parents who are looking for a simple, affordable product that they can manage on their own terms. Both our Junior ISA and Child Trust Fund can be managed online providing round the clock access to key account information.
“The Junior ISA was designed as a universal savings option for parents and Family Investments is committed to making the product a success. However, without the initial nudge of a government voucher, there is no guarantee that parents will continue to see the Junior ISA as the natural home for their children’s savings. Both the government and the savings industry need to continue to build awareness of the product to ensure that the current momentum behind the product continues to build.”
For further information, visit the Family Investments website to find out more about their Junior ISA