Lesson 1 of 5
The best accounts to invest for your children by country
Junior ISA, 529, RESP, custodial accounts. Start at birth and compound interest does the parenting.
Lesson video
Why starting at birth matters
A child born today has 18 years before they need the money. At 8% average return:
£100/month from birth to 18 = £48,353 (£21,600 contributed, £26,753 from growth = 124% return on contributions) £200/month from birth to 18 = £96,706 £50/month from birth to 18 = £24,177
Even £50/month turns into a university fund, a first home deposit, or a head start on investing. The key is starting early and letting compound interest work across 18 years.
Children's investment accounts by country (2026)
| Country | Account | Annual limit | Tax treatment | Access |
|---|---|---|---|---|
| UK | Junior ISA (JISA) | £9,000/year | Tax-free growth + withdrawals | Child at 18 |
| UK | Junior Self-Invested Personal Pension (SIPP) | £3,600/year (gross, incl. tax relief) | 25% tax-free at 57+, rest taxed as income | Child at 57 (pension rules) |
| US | 529 Plan | No federal limit (gift tax at $19,000+) | Tax-free for qualified education expenses | Any age, for education |
| US | UGMA/UTMA (custodial) | No limit | First $1,350 tax-free, next $1,350 at child rate | Child at 18-21 (state dependent) |
| US | Roth IRA (if child has earned income) | $7,500 or earned income, whichever is lower | Tax-free growth + withdrawals after 59.5 | Contributions any time, earnings at 59.5 |
| CA | RESP | $50,000 lifetime | 20% CESG match up to $500/year (on first $2,500) | For education, contributor controls |
UK: the Junior ISA is the clear winner for most families. £9,000/year tax-free. At £750/month for 18 years at 8%: £362,650. The child receives it at 18 with no tax to pay. If you cannot afford £9,000/year, even £50/month makes a meaningful difference.
“My six-year-old has a six-figure net worth. My four-year-old has a five-figure net worth. She is only four.”
Started investing for her daughters at birth using custodial accounts and a Roth IRA.
Canada: the RESP is free money
The Canada Education Savings Grant (CESG) matches 20% of the first $2,500 contributed to an RESP each year, up to $500/year per child ($7,200 lifetime). This is a guaranteed 20% return before any investment growth.
At $2,500/year for 18 years with the CESG match and 8% growth: approximately $120,000 (of which $45,000 is contributions, $9,000 is CESG, and $66,000 is growth). The CESG alone is $9,000 of free money the government gives you for saving for your child's education.
Knowledge check
You contribute £100/month to a Junior ISA from birth. At 8% average annual return, approximately how much will the account hold when the child turns 18?
“I invested for 11 years. First in my family to ever buy a stock. That nest egg is what let me quit my job.”
Applied to: The best accounts to invest for your children by c
Common questions about the best accounts to invest for your chi
Getting started with the best accounts to invest for you
Understand your current position
Use the calculator on the homepage to see your take-home pay and tax position before making changes.
Take the first small step
You do not need to do everything at once. Pick the single action from this lesson that has the highest impact and do it this week.
Review after one month
Check the effect on your payslip or bank statement. Adjust if needed. Progress, not perfection.
Use the Wealthy Employee calculator to see how the best accounts to invest for your chi affects your specific take-home pay and tax position.
Knowledge check
Based on what you learned about the best accounts to invest for you, which statement is most accurate?