Junior SIPP

Important information - please keep in mind that the value of investments can go down as well as up so you may not get back what you invest. Eligibility to invest in a Junior SIPP depends on personal circumstances and all tax rules may change in the future. Control over the investments passes to the child once they turn 18 and withdrawals will not normally be possible until they reach 55.

A tax-efficient way to build a retirement nest egg for your child. The Junior SIPP allowance for the 2019/20 tax year is £3,600, and you have until 5 April 2020 to use it. Control of the pension passes automatically to your child at 18, however the money is locked away until retirement age (usually 55).

*To pay in a total of £1,000 to your Junior SIPP, you would only need to contribute £800, and the government would pay the other £200.

When your child is born, if you invest just £2,880 (topped up to £3,600 by the government), it could grow to approximately £117,000 by the time they are 65, which could make a huge difference to their retirement savings. This is thanks to long-term growth potential and the effect of compounding.

Tax rules and reliefs are likely to change between now and a child’s retirement and the eligibility to invest in a pension will depend on personal circumstances. The amount you might get back at 65 is only a projection, it's not guaranteed. Please remember, how your investments perform and the charges may affect the value of your investments and you may not get back the amount you invested. You will not normally be able to withdraw money from a pension until you are 55. 

This information is not a personal recommendation for any particular product, service or course of action. If you are unsure about the suitability of a Junior SIPP for your personal circumstances, you should speak to an authorised financial adviser.