WHERE TO PUT CASH FOR YOUR CHILDREN

SAVINGS rates for children can be as much as three times higher than adults can get.

Junior Isas allow you to save up to £4,128 tax-free each year until your child turns 18. They can’t access this money until then.

Coventry Building Society offers the top Junior Isa rate at 3.25 pc. Nationwide, Halifax and Tesco all pay 3 pc, the next best deal.

These rates are not fixed, which means the bank or building society can change them at any time. You need to deposit only £1 to open an account. You can also save for your children outside of an Isa.

National Savings & Investments (NS&I) offers a tax-free, five-year bond fixed at 2 pc, up to a maximum of £3,000 per child. The minimum investment is £25.

If you withdraw any cash early you will be charged an amount equal to 90 days’ interest.

There are also regular savings accounts where you can put aside a set amount for your child every month.

Saffron Building Society pays a top 4 pc on its Children’s Regular Saver account.

You need a deposit of £5 to open the account and can save a maximum of £100 a month for children up to the age of 15.

Halifax Kids Regular Saver, designed for adults to save in trust for their children, also pays 4 pc on savings between £10 and £100 a

month. If you put in the maximum each month, you will end up with £1,224 after a year.

Make sure you move the money once your 12 months is up or you could end up with an easy-access account that pays a pittance.

At the end of the year, you can open another Kids Regular Saver if it is still on sale. You can hold only one account per child in any one year.

Another option is a children’s easy access savings account, which will allow you to dip in and out of the pot.

Santander offers 3 pc interest on balances between £300 and £2,000 in its 123 Mini account for under-11s. When the child reaches 11, the money can be transferred into a Mini current account, which pays the same rate.