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National Savings & Investments has increased the rate on its Junior ISA to 2.5%.

It’s always good to see a rate rise, but parents looking for the best return on children’s savings can get a better deal elsewhere.

The best buy JISAs are Coventry Building Society’s 3.5% (0800 121 8899/in branch), Nationwide Building Society’s 3.25% (in branch/via nationwide.co.uk) and Tesco Bank’s 3.15% (0345 678 5678/via tescobank. com).

Junior ISAs are a long-term savings plan, with the account holder unable to access funds until the age of 18. The current annual JISA allowance is £4,128, rising to £4,260 from April 6.

Andrew Hagger, of personal finance site Moneycomms.co.uk, said: “Whether it’s paying in a lump sum once a year or drip-feeding money into the account each month, it makes sense to bag the best rate you can for your children so that you can help them get a decent financial start in life.”

Getting an extra 1% will make a big difference over an 18-year term and it’s easy to switch savings to a new account – providers do all the legwork for you.