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Savings & ISAs

Junior ISAs explained: saving and investing for children

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Quick answer: A Junior ISA (JISA) lets parents or guardians save up to £9,000 per year tax-free for a child. The money belongs to the child and is locked until they turn 18, when it converts to an adult ISA.

Junior ISAs are the main tax-free savings wrapper for under-18s in the UK. They replaced Child Trust Funds and come in two types: Cash JISAs and Stocks & Shares JISAs. Once opened, anyone — parents, grandparents, friends — can contribute up to the annual limit, but only parents or guardians can open and manage the account.

Cash vs Stocks & Shares JISA

A Cash JISA earns interest tax-free — suitable for shorter timeframes or risk-averse families. Rates are similar to adult Cash ISAs.

A Stocks & Shares JISA invests in funds, shares or bonds. Over 10+ years, historical returns have beaten cash, but values can fall. Most financial planners recommend investing for children with long time horizons.

Who can contribute

Anyone can pay into a child's JISA — grandparents often use them for birthday and Christmas gifts. The total across all contributions must not exceed £9,000 per tax year.

The child cannot hold both a Cash and Stocks & Shares JISA simultaneously — you choose one type per child per year.

What happens at age 18

The JISA automatically becomes an adult ISA. The now-adult child can withdraw everything, continue saving, or transfer to a different ISA provider.

Parents have no legal right to the money once the child turns 18. Discuss financial planning with teenagers before their JISA matures.

Common questions

Can a child have both a JISA and a Child Trust Fund?

No. If your child has a Child Trust Fund from the old scheme, you can transfer it into a JISA but cannot hold both.

Does a JISA affect benefits?

JISA balances are not counted toward the parents' capital limits for means-tested benefits because the money belongs to the child.

Should I open a Cash or Stocks & Shares JISA?

For timelines of five years or less, Cash is safer. For 10+ years until adulthood, a Stocks & Shares JISA has historically delivered higher returns despite short-term volatility.

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