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Investing in a Junior ISA is possibly one of the most effective ways for you – and others – to save for your child’s future

 

To get the most out of a Junior ISA (JISA), it’s best to start early and save on a regular basis. Not only will this help increase the value of your nest egg, it can also encourage good investment habits for both you and your child.

Here are five good reasons to invest in a JISA. They are:

 

  • Tax-efficient: A JISA – like a standard ISA – is effectively a tax-efficient wrapper allowing you to invest up to £4,368 in 2019-20, either in cash or stocks and shares. This allowance is on top of your regular ISA-savings allowance (£20,000). Remember, there is no capital gains tax (CGT) to pay on investment gains, and investment within this wrapper can grow in a tax-efficient environment.

 

  • Long-term: Money invested in a JISA is locked away until a child’s 18th birthday, so these are ideal longer-term investment plans. If you start saving when your child is young you’re looking at a 15-year-plus horizon. This means you could think about a more adventurous strategy, for example putting money into investment trusts that have exposure to emerging markets. These may be more volatile over shorter time frames but have the potential to deliver higher returns over the longer term.

 

  • Cumulative: You don’t need to have a large lump sum or be especially wealthy to open a JISA. Most providers offer regular investment plans that can be opened from as little as £25 per month. Even relatively small amounts can build to a sizeable sum over long periods, particularly when compound returns are taken into account – in other words, getting returns on your investment returns.  Regular savings plans also help smooth out stock-market movements; ideal for those investing in more adventurous sectors

 

  • Collaborative: Parents are not the only ones who can save into a JISA. Grandparents, godparents and family friends can all contribute, provided the total invested does not exceed £4,368 in the 2019-20 tax year. These contributions do not affect the donor’s own ISA allowance.

 

  • Educational: Investing in a JISA can help you demonstrate good savings habits and highlight the growth potential of equities to your child. The rewards of this may last even longer than the JISA plan itself.

 

J.P. Morgan Asset Management offers a variety of investment trusts suitable for Junior ISA investment. This includes our multi asset trust, JPMorgan Elect Managed Growth as well as more adventurous options, investing in a range of global markets. The JPMorgan Emerging Markets Investment Trust for example, may be an option for parents with a longer-time investment horizon.

 

 

Full risk profiles for individual trusts can be found at am.jpmorgan.co.uk

 

 

Important Information:

 

This is a marketing communication and as such the views contained herein do not form part of an offer, nor are they to be taken as advice or a recommendation, to buy or sell any investment or interest thereto.

Reliance upon information in this material is at the sole discretion of the reader. Any research in this document has been obtained and may have been acted upon by J.P. Morgan Asset Management for its own purpose.

The results of such research are being made available as additional information and do not necessarily reflect the views of J.P. Morgan Asset Management. Any forecasts, figures, opinions, statements of financial market trends or investment techniques and strategies expressed are unless otherwise stated, J.P. Morgan Asset Management’s own at the date of this document. They are considered to be reliable at the time of writing, may not necessarily be all inclusive and are not guaranteed as to accuracy.

They may be subject to change without reference or notification to you. It should be noted that the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested.

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Furthermore, whilst it is the intention to achieve the investment objective of the investment products, there can be no assurance that those objectives will be met. J.P. Morgan Asset Management is the brand name for the asset management business of JPMorgan Chase & Co. and its affiliates worldwide. To the extent permitted by applicable law, we may record telephone calls and monitor electronic communications to comply with our legal and regulatory obligations and internal policies.

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This communication is issued by JPMorgan Asset Management (UK) Limited, which is authorised and regulated in the UK by the Financial Conduct Authority. Registered in England No: 01161446. Registered address: 25 Bank Street, Canary Wharf, London E14 5JP. 0903c02a824df49a

 

 

 

 





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