Top junior stocks & shares ISAs
How to invest tax-free on behalf of your child
Over the long term, investing will hopefully substantially outperform saving, so your kids will likely get a far bigger nest egg. The best way to do it is via a Junior stocks and shares (investment) ISA – these let you invest up to £9,000 a year on behalf of your child with any income and gains protected from tax. This guide explains how they work and how to open one via our top-pick platforms.
Martin Lewis: An important note about junior ISAs
If you’re locking money away in a Junior ISA until your child is 18, I’d strongly urge you to consider investing rather than saving (or, if nervous, at least invest some of it). The reason comes down to the two big 'when to invest' rules...
It should be money you don’t need to use for now. If you’re putting money in a Junior ISA, and your child isn’t almost 18 already, they can’t need it – or you wouldn’t be locking it away.
It should be money set aside long term (say, 5+ years). JISAs lock money away until they’re 18, so for most who start when their child’s young, that’s long term.
So JISAs can hit the sweet spot for when to invest.
Watch Martin explain why to consider investing, not saving.
As Martin mentioned above, a JISA by nature often hits the sweet spot for when to invest. And as, over the long term, investing usually vastly outperforms saving, your kids will likely have a far bigger nest egg. Martin explains this in full in his video below.
What are junior ISAs? Should I get one for my kids?
You can save for your child in an kids' savings account or within a Junior ISA (JISA) – a tax-free account wrapper which an under-18 can have up to £9,000 total paid into each tax year. Once in a JISA, the money stays tax-free year after year, so for those lucky enough to have it maxed out each year, it can end up in the £100,000s.
There are both cash (savings) JISAs, where the interest isn't taxable, and stocks & shares (investment) JISAs – which we go through in this guide – where investment gains & dividends aren't taxable. A child can have both, but the limit is £9,000 a year in total for the two.
JISAs must be opened by a parent or guardian with parental responsibility, or a child who is 16 or 17 can open a JISA themselves. In either case, at 16, the child can take control of the account.
❌ DON'T use JISAs for money your kids will need while they're kids. The money can't usually be withdrawn or touched until they're 18 (barring terminal illness and death), so it's only for money you're putting away for their long-term future.
✔️ DO use JISAs for money you want to lock away until they're adults. Once money is in a JISA, it's only accessible one they turn 18. So it's a simple way to lock money away for their future without them getting their hands on it. Yet on the day they turn 18, it's their money and is under their control. So, if you're putting it aside for them to use at university, beware they may decide to buy a Harry Styles-themed camper van instead.
✔️ DO look at JISAs if your child may pay tax, especially if their money comes from parents. This isn't that important for smaller amounts, as most children don't pay tax. Not because they don't need to, children are mostly taxed like adults, meaning they can usually earn £12,570 from any source tax-free. It's just most don't earn enough. Yet money given by parents is different for under-18s – see our full explainer.
- In a split family? Don't both parents open one, that can cause problems.
- Grandparent? See our how to save for your grandchildren guide.
Martin: Using a JISA, most should be going for shares not cash...
A shares JISA is a tax-free investment account that allows parents to buy and sell different types of investments – such as funds, shares and bonds – on behalf of their child, where gains and dividend income are protected from tax – more on this below. If you're feeling a bit lost, read our Investing for beginners guide first for more on different types of investments.
Investing means your money is put in assets such as shares, corporate bonds and more, in the hope that you get far higher growth, but at the risk you could end up with less than you put in.
Yet if you aim for a wide spread of investments (more on how to easily do that), as most beginners should, that helps mitigate the risk.
Do that and, on the big balance of probabilities, over the long term investing will hopefully substantially outperform savings – in which case your kids will have a far bigger nest egg.
JISAs are a very important tax protection for shares and funds.
The fact you invest within a JISA means any gains or dividends aren't taxable. Capital Gains Tax is the tax you pay on profits, and children pay it just like adults, which means they have a £3,000 per tax year allowance. That sounds a lot for children, but the way Capital Gains works means it isn't as big as it seems. Here's an example to help explain:
Imagine you bought a fund for £9,000 and ten years later, it'd done well and you sold it for £30,000. The Capital Gain is £21,000. The fact you'd held it for ten years is irrelevant, even if you'd never made another Capital Gain in all that time. All of it usually crystallises in the tax year you sell.
That's why Capital Gains Tax can be so big – outside an ISA you're taxed on profits above £3,000 in the year, so in a simple case £18,000 would be taxable (the rates are 18% or 24% depending on your income). Whereas in a JISA it's all tax-free.
Money given by parents is different for under-18s
If a child earns £100+ a year, in interest or dividends, from money given to them by a specific parent or step-parent (not grandparents, aunties, uncles or others) it's all taxable as if it were the parent's income.
This is to stop parents stashing their own cash in their child's name. So if the parent has used up their Personal Savings Allowance or dividend allowance and pays tax on income, their child will too. That's when JISAs really count, as money given by parents isn't taxable.
We cover taxes on investment in more detail in our Investing for beginners guide.
Upcoming changes to Stocks & Shares ISA rules
From April 2027, you will be taxed at 22% on interest earned on cash held in a non-cash ISA, such as a stocks and shares ISA or innovative finance ISA. Read our full story – Cash held in stocks and shares ISAs to be hit with 22% charge on interest from April 2027.
How to choose an investment platform
You can open junior stocks & shares ISAs for your child via investment platforms – this is a bit like how you buy gig tickets through a ticket website, though unlike ticket websites, platforms can be cheaper than going direct to the fund manager.
While we can't tell you what the best platform for you is, we can give you all the information so that you can make an informed decision. There are three main decisions:
Step 1: Choose if you want a 'DIY' or 'managed' platform.
The main differences between 'DIY' and 'managed' portfolios are how much of your own research you plan to do, how much control you want over what you invest in and how much you want to pay. Some investment platforms only offer one type, some offer both, do check.
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DIY portfolios. With do-it-yourself, you must do your own research to decide what to invest in and build and maintain your own portfolio. They're the cheaper option, but there's more risk if you aren't confident in what you're putting your money into.
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Managed portfolios. There are two types – those that are managed by a set of real life experts, and those that are managed by an automated service (we call these 'robo' investors). Both types will help you to choose an investment portfolio, based on your attitude to risk and your investment goals. As they're more comprehensive, they're more expensive. In general, managed platforms can be a good choice for beginners, as you're getting all the work done for you, but it'll usually cost you more.
Step 2: Choose if you want low-fee or a bigger brand.
We've compiled a mix of both cheaper and well-known options, for both DIY platforms and for managed platforms.
Unsurprisingly, the bigger names tend to be more expensive, though in return they often have resources to help you learn and choose what to invest in, a history of decent customer support, and a user-friendly app and online dashboard.
Step 3: How to open one depends on when your child was born...
Any child under 18 can have a junior stocks & shares ISA, but how you open one depends on when they were born:
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Child born on or after 3 January 2011? Most investment platforms offer investment junior ISAs. You can open it for them, or they can open it themselves at 16 or 17.
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Child born between 1 Sep 2002 and 2 Jan 2011? They’ll likely have had a Child Trust Fund (CTF) automatically opened for them by the Government. You can't have a CTF and a JISA, so you'll need to convert the CTF, which can usually be done via a transfer form at application. Can't find your CTF? See how to reclaim your lost Child Trust Fund.
Top stocks & shares JISA platforms
Our tables below – first are DIY platforms, below that are managed platforms – list the management and trading fees for each platform, but we haven't taken fund charges into account. These will vary depending on which fund you pick and – to an extent – which fund platform you choose (some platforms negotiate deals with fund managers for cheaper fees).
Keep an eye on fees, as which works out cheapest for you will depend on what you invest in, how much you have to invest and how often you trade. Managed platforms unsurprisingly tend to have higher management fees, though often costs are kept low as the funds which are typically chosen have low management fees.
There are many platforms out there, so always do your own research. Better still, if you already have a financial adviser, speak to them.
Platform + min deposit | Annual fees | MSE analysis |
|---|---|---|
Open online, via phone or via post with £100+ or £25/mth | Management fee: none Buying shares/funds: none | Low-cost option from very well-known investment platform. Offers a huge range of funds, ETFs, investment trusts and shares to choose from with no platform or dealing fees. |
Open online with £1+ | Management fee: none Buying shares/ETFs (no funds): none | A low cost option for those happy investing in ETFs and shares. It doesn't offer traditional funds, but offers a huge range of options and no management or trading fees. You must have an adult IG account to apply. |
Open online or via app with £100+ or £25/mth | Management fee: none Buying shares/funds: £7.50 (£1.50 if part of reg savings plan)/ none | Another low cost JISA with no fund dealing charges. Offers a very broad range of funds and shares. |
Open online with £500+ or £100/mth | Management fee: 0.15% Buying funds: none | Only offers its own (mostly index-tracking) funds. Less choice but can be a cheap, simple option for long-term investing. |
Open online with £250+ or £25/mth | Management fee: 0.25%/yr (max £2.50/mth for shares, no max for funds) Buying shares/funds: £5/£1.50 | Slightly more expensive option, but well-known platform with extensive range of investment options. It also waives its dealing charges for regular investing (£25+ a month). |
All firms listed allow transfers in, though Fidelity doesn't allow transfers in from a Child Trust Fund.
Platform + min deposit | Annual fees (1) (2) | MSE analysis |
|---|---|---|
Open online or via app with £500+ | Management fees: 0.3% to 0.7%/yr (min £1.25/mth) Av. fund cost: 0.11% to 0.24% | Range of ready-made portfolios, including ESG and provides access to investment consultants if you want extra guidance. |
Open online or via app with £1,000+ | Management fees: 0.6%/year Av. fund cost: 0.14% (original plan) or 0.46% (ethical plan) | Choose a risk level from cautious to adventurous and Wealthify invests your money in a managed portfolio, with a choice of standard or ethical 'themes'. |
Both allow transfers in. (1) Management fees based on investments of up to £100,000, there's a lower fee for larger amounts with Moneyfarm. (2) Total average fund cost comprises fund charges + market spread.
You can transfer to another junior shares ISA (or cash ISA)
If you already have a junior investment ISA, you may want to transfer to a different platform, perhaps to take advantage of lower fees. To do this you’ll need to apply for the new account and tell your new platform you want to do an ISA transfer. This is typically done during the application process by filling out a transfer form.
You can also transfer a junior cash ISA to a junior investment ISA, or vice versa. A child can have one cash JISA and one stocks & shares JISA at a time, and you must split the child’s £9,000 annual ISA allowance between the two.
Key investing tips for beginners
We don't cover what to invest in because we never want to have told you to put your money in something, only for you to lose money on it – there are many sites that do, more on these below. But there are some key concepts which many beginners find useful.
Martin's A beginner's guide to investing covers this in full but here are some quick tips:
Tracker funds are a good starting point for beginners.
Buying individual shares is highly risky for beginner investors. Instead, many choose to use a 'fund', which owns lots of different shares, or bonds, or other assets, and you get a merged performance of them all.
And within the choice of funds, the easiest are tracker funds – they usually have low fees and simply track the performance of a specific index, such as the S&P 500 (big firms on US stock-market companies) or the FTSE 100 (big firms on UK stock-market)
On Martin's Investing for beginners podcast, Ed Marshall of Deans Wealth Management, said:
You want to be in more than the FTSE 100 or S&P 500. If you look at the MSCI World Index, you've got [over a thousand of] the world's largest companies, but then you can buy global tracker funds that will buy even more shares, so instead of just 200 different companies, try and aim for 5,000+ different companies. Try and buy the world. That diversification will help to take risk off the table.
It's best to invest on a regular basis, little and often.
One way to mitigate any volatility, that many investment advisors suggest, is to drip feed a larger lump sum in smaller increments. Doing it little by little can help smooth out the regular short term ups and downs that are common.
If you invested all your money in one go, and the markets you invested in all suddenly tanked, you might start to panic. But by drip-feeding, it'd just mean you’d be buying some of your investments at different prices.
Yet drip-feeding isn’t always best. If you’ve a lump sum ready to invest, putting it all in at once gives it more time in the market, which can produce better returns over the long term.
You can get free research to help choose what to invest in.
The sites below all offer much more detailed guidance on where to invest...
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Hargreaves Lansdown – helpful and easy-to-navigate site, including a 'Wealth Shortlist' – a collection of funds selected for their performance potential.
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Interactive Investor – includes beginners' guides on a range of investments, a glossary of terms and tables showing the 10 top, bottom and most-traded funds via its platform each month.
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Bestinvest – a large range of free guides covering everything from how to spot the worst-performing funds, to the top-rated funds.
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Charles Stanley Direct – the market data section breaks down lists of FTSE companies and allows you to check performance for any time period from one day to three years, updated every 15 minutes.
Junior investment ISA FAQs
Can you have a Child Trust Fund and a junior ISA?
No, a child can't have both a Child Trust Fund and a JISA open at the same time. This is why, if your child does have a CTF, you'll have to transfer it if you want to open a Junior cash ISA or a junior investment ISA.
How do you transfer a Child Trust Fund to a junior ISA?
To do this, you just need to find a junior ISA which accepts transfers in from CTFs (most do, but there are a few which don't) and open the account. During the application process, the new provider should present details of how to transfer a CTF, and include a transfer form where you fill out the details of your child's CTF.
For full details, see our Child Trust Funds guide, or if you're unsure if your child has one, see our Reclaim your Child Trust Fund guide.
What's the difference between funds and ETFs?
When you invest in funds via a platform, the main ways to do this are via traditional funds or exchange-traded funds (ETFs). The investment you hold can be very similar, as both typically give you a stake in a fund holding many underlying investments.
The key difference is how they're bought and sold. ETFs trade on the stock market like shares, with prices moving throughout the day, while traditional funds are bought and sold in units at a price calculated once a day. They are often different wrappers for very similar underlying investments, so for most the choice of investment is likely to matter more than whether it's held as an ETF or traditional fund.
If this all sounds a little complicated, there's more info in our Investing for beginners guide.
How do I pay into a junior ISA?
You can usually deposit money into a junior ISA in the same ways you would with a normal bank account, via cash deposit in branch, cheque, a one-off bank transfer or a regular payment such as a standing order.
You can deposit a lump sum or top up your child's ISA as frequently as you like, though you can't pay in more than the £9,000 allowance per tax year.
You can also transfer an existing junior ISA to a new provider. Some (but not all) providers also allow you to transfer existing Child Trust Funds.
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