Junior ISAs are here. After all the speculation they have finally arrived amidst speculation in the market place about how well they will be received.
There appears to be a tricky situation with regard to existing Child Trust Funds (CTFs) and the inability to transfer these into Junior ISAs thus preventing those individuals with existing CTFs opening new Junior ISA accounts which are potentially more flexible.
This problem must be addressed sooner rather than later or the Government will end up undermining what is essentially a good idea for encouraging significant savings, particularly with the rising cost of education in mind. The advent and subsequent apathy to stakeholder pensions springs to mind - an honourable idea, but ultimately flawed by smallprint.
It has been interesting to watch the marketplace for Junior ISAs, a handful of providers showed their intent early on and are ready to accept new applications immediately, however, the majority have held back with a wait and see approach.
Their position seems to be to see how popular these products are and if they are then forced to launch solutions for clients or risk losing out on business. For initiatives such as Junior ISAs we believe that all providers need to offer Junior ISAs alongside their existing ISA offerings or we will forever be in this hypocrisy whereby those said providers preach about their great solutions for savings for the young in terms of their traditional, more complex products, but won't move with the times to offer a modern day solution. How can they preach in future? No doubt they will still find a way.
We believe the future is bright if the red tape is cut away and they become as simple a concept as existing ISAs. If you would like more information on how to invest in this area, please contact us.
Tags: Junior ISAs, Child Trust Funds, education