Very small long term investment for kids?

The Davestator

Tried the search function but couldn't find an answer.

I'd like to invest a small amount each month for my kids for the next 20 years or so which may give them a small little lump sum in time for college.

I'm only thinking of around 50 per month.

I've no idea about any of this and it may not be worth doing at all (stick it in a jar?!)

Any advice appreciated.

ct5amr2ig1nfhp

It's a relatively small sum. How about a regular savings account?

An EBS Children’s & Teens Savings Account is currently 2.01% AER up to maximum of 5000 EUR. Also, take a look at the Family Savings 3% (1 year, max 1,000/month).

Prezatch

Other option is open an account with Degiro (most people on here us them as their fees are extremely low). Save up around 3-6 months worth of your monthly contributions (€150 - €300 total) and every 3-6 months invest in a broad based basket of stocks to try and achieve close to the market benchmark return (S&P 500).

You can do this by buying an ETF (exchange traded fund) with a low expense ratio (fee). I'd recommend VOO as it is well diversified and cheap(https://personal.vanguard.com/us/funds/snapshot?FundIntExt=INT&FundId=0968).

Prices are high at the moment as the market has been in a bull state for quite some time so there is a possibility that it may dip down in the short-medium term. However, your investment horizon is long term so these ups and downs will even out. 20 years is a long time and enough to not have to worry about market recessions.

Don't invest monthly as you'll build up too many fees for the amount that you are contributing. Also don't invest annually as you would be more likely to get caught out by market peaks. Regular investing ensures a smoother return.

Water John

Try Post Office. Used to have a good rate on this. Don't know now.
Savings very safe, which is probably what you require.

Dardania

These investments could be suitable?:

http://www.anpost.ie/AnPost/MainContent/Personal+Customers/Money+Matters/National+Solidarity+Bond/

Water John

See that Dardania. Rate is very low. Anywhere that would yield a few % and not have the capital being eroded by inflation?

Cute Hoor

Prezatch wrote: »

Other option is open an account with Degiro (most people on here us them as their fees are extremely low). Save up around 3-6 months worth of your monthly contributions (€150 - €300 total) and every 3-6 months invest in a broad based basket of stocks to try and achieve close to the market benchmark return (S&P 500).

You can do this by buying an ETF (exchange traded fund) with a low expense ratio (fee). I'd recommend VOO as it is well diversified and cheap(https://personal.vanguard.com/us/funds/snapshot?FundIntExt=INT&FundId=0968).

Prices are high at the moment as the market has been in a bull state for quite some time so there is a possibility that it may dip down in the short-medium term. However, your investment horizon is long term so these ups and downs will even out. 20 years is a long time and enough to not have to worry about market recessions.

Don't invest monthly as you'll build up too many fees for the amount that you are contributing. Also don't invest annually as you would be more likely to get caught out by market peaks. Regular investing ensures a smoother return.

I would wholeheartedly agree with this, although the sum being saved is quite low which would mean that you could only buy 1 share every 4/5 months or so. There are no purchase fees for VOO on DeGiro so you can buy as often as you want/can afford. This fund was launched in 2010 (I think) at $100, it is now at $237, and you would have been getting quarterly dividends along the way. There are no guarantees that that sort of performance will continue.

There are 2 risks with VOO, the price can go up or down (although with the fund being invested in some of the biggest and best companies in the world it is difficult to see how it would not perform reasonably well over OP's projected lifespan) and the currency risk.

Monies invested in a totally safe haven like An Post are likely to lose their real value over time with inflation.

ct5amr2ig1nfhp

Is it worth looking into p2p lending? For example Mintos, ViaInvest etc. Returns of 10-15% possible.
You can limit your risk buy investing in loans with buyback guarantee etc. You should look into the risks of p2p lending before getting involved.

Sabre Man

Cute Hoor wrote: »

There are no purchase fees for VOO on DeGiro so you can buy as often as you want/can afford.

Not entirely accurate:
DEGIRO now offers clients the ability to trade ETFs commission free. Each calendar month you will have one commission free trade per ISIN, and can then increase your holding in that ETF for free provided that the order is a minimum of 1000EUR/USD(depending upon the currency which the ETF is traded in).

Truckermal

I have been saving 20 euros every week in the local CU for my 6 year old since she was born, there is a nice few pound in it now.

Cute Hoor

Sabre Man wrote: »

Not entirely accurate:
DEGIRO now offers clients the ability to trade ETFs commission free. Each calendar month you will have one commission free trade per ISIN, and can then increase your holding in that ETF for free provided that the order is a minimum of 1000EUR/USD(depending upon the currency which the ETF is traded in).

Sorry, forgot the limits.