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Children reach adulthood fast which means it is important to start thinking about saving when they’re still at school. By saving from just £10 to £25 a month with Scottish Friendly’s Child Bond at this time you could help them ride out future financial hard times when they are older. For example helping to pay for university fees or providing the means to acquire a residence.

You can save tax-free for any child with a Scottish Friendly Child Bond. It’s tax-free because it’s a friendly society savings plan, so under present-day legislation it grows free of income or capital gains tax. It’s a marvelous way for parents, grandparents, family members and friends to make a big financial difference when the little ones are older.

Put succinctly the Child Bond is a with-profits investment plan: It invests for long-term growth as well as a certain degree of security, in stocks and shares, fixed interest funds and cash.

The amount you save accumulates through the addition of potential yearly bonuses and at the relevant time when the bond maturesthere’s a tax-free payout. The value of bonuses depends on how much profit we make and how it is distributed by us. It should be noted that bonuses are not guaranteed.

The Child Bond may last for a minimum of 10 years, but it is possible to invest for longer should you choose to - perhaps to coincide with an 18th or 21st birthday. You can save either monthly, annually or with a lump sum payment.It’s totally up to you. Please note if the plan is cashed in before the end of the term, the amount the child will receive may be less than the amount paid in.

If you would like the monthly option, you can get started by saving from as little as £10 a month - up to a maximum of £25 per month. Or you can make single twelve monthly payments of up to £270 a year.

You can also make the payment of all of the premiums in one go through our lump sum funding plan. If you invest the maximum permitted amount of £2,340 for ten years, this actually invests £270 a year into the Child Bond - a total of £2. The minimum lump sum of £1,040 will yield £120 a year for 10 years - a total of £1,200. This provides a way and means for you to pay all your premiums at once and is something that has proved popular with grandparents who like the reassurance of knowing all premiums for the entire term of the plan are taken care of.

This particular plan has life cover included with it so you should consider if this is apposite for your financial needs. See also our Child Trust Fund account