Family is one of the most important facets of life for many people, so it makes sense that you will want to take care of them in every way possible. One of the most effective ways to do this is to put money aside regularly in order to ensure that they always have a decent income throughout their lives.
Here are some tips and considerations if you want to invest some money in order to benefit your family.
Open a SIPP
A SIPP is a Self-invested Personal Pension, and it allows you to make regular contributions and build up a fund over the years. Provided by specialist firms like Bestinvest, SIPPs can also be opened on behalf of a family member. If you are a parent or legal guardian, for instance, you can easily open a SIPP for your child.
They can also be incredibly useful for those who are self-employed, given that they do not have access to a workplace pension. One of the best aspects of a SIPP is that you also get plenty of choice as to where your money is invested. However, you should make sure that a SIPP is suitable for you before taking action.
Child saving account
You may also want to consider opening a child saving account in order to build some funds for your children. These can also be very useful for teaching them how to save and how bank accounts work (you are also investing in their financial education).
It is well worth shopping around to find accounts which offer a decent rate of interest. Many offer interest levels which are relatively poor, but there are certainly accounts out there which stand out from the crowd. You can make contributions into a child saving account, but beware that if a parent/step-parent puts money in and the interest is more than £100 per year, it will be taxed as if it were the parent’s money.
Stocks and shares
Investing in the stock market is another option which could benefit your family. Some stocks pay dividends, meaning you get paid a share of the profits at regular intervals (often quarterly).
This has the potential to seriously boost your income in the long run, especially if you keep buying more shares on a regular basis (although you could also lose money as shares are risky). Once you have a diverse portfolio, you can sell your stocks and shares when you wish (hopefully for a higher price than they were bought) to pay for things like education, home improvements, a car, etc.
There are plenty of ways you can invest in your family. Be sure to always monitor your investments and make any changes if or when necessary.