How to Open a Savings Account for Your Grandchild in the UK
Looking to give your grandchild a financial head start? Whether you are saving for birthdays, a first car, or future education, there are several good ways to save in a child’s name in the UK. Grandparents can usually fund and help manage accounts, and in some cases can open them directly using a trust structure.
Can grandparents open a savings account for a grandchild?
Usually a parent or legal guardian must be the account opener for standard children’s bank accounts. Grandparents can still pay in and often view or help manage the account once it is open.
If you want to set something up yourself, you can open an account as a bare trust where you act as trustee and the grandchild is the beneficial owner. The money legally belongs to the child and becomes fully theirs at age 18.
Best account types for grandchildren
- Junior Savings Account Easy access savings in the child’s name with interest. Opened by a parent or guardian. Grandparents can pay in.
- Junior Cash ISA Tax free interest within the £9,000 Junior ISA allowance for 2025/26. Must be opened by a parent or guardian, but anyone can contribute. See our Junior ISA guide.
- Junior Stocks and Shares ISA For long time horizons, investing may offer higher growth potential. Risk is higher than cash. Contributions count toward the same £9,000 JISA limit.
- Regular children’s saver Often pays a higher rate in exchange for monthly deposits and limited withdrawals. Check if rates drop after the first year.
- Bare trust account A current or savings account, or even an investment account, held by you as trustee for the child. Good for larger gifts or if you want to invest outside a Junior ISA.
Who can pay in and how much?
Anyone can contribute to most child accounts. For Junior ISAs the total that can be paid in across cash and investments is £9,000 in 2025/26. For standard children’s savings there is no ISA limit, but normal savings interest may be taxable in some situations.
Documents you will need
- Child’s full name and date of birth, often the birth certificate
- Photo ID and address proof for the adult opening the account
- Parental consent where the provider requires a parent or guardian
- For bare trusts, the bank may ask you to complete a simple trustee declaration
Tax points to know
- Junior ISA interest and investment growth are tax free.
- Grandparent gifts Interest on money you give is taxed on the child, not on you. The special £100 rule that can tax interest as the parent’s income does not apply to grandparents.
- Inheritance tax gifting rules You can give up to £3,000 per tax year that is immediately outside your estate. Small gifts of up to £250 per person are also allowed if no other annual exemption is used for that person. Most larger gifts fall out of the estate after seven years.
See the official guidance on gifts and exemptions at GOV.UK.
Access and control
- Junior ISA Locked until age 18. Control transfers to the child at 16 for management, but withdrawals are only at 18. Converts to an adult ISA at 18.
- Children’s savers Usually allow withdrawals by the registered adult. Terms vary by provider.
- Bare trust Money belongs to the child from day one. As trustee you manage it for their benefit. They gain full control at 18.
How to choose the right option
- Short term saving and easy access Children’s easy access saver or a regular saver.
- Tax free and simple Junior Cash ISA if a parent can open it and you want to contribute.
- Long time horizon Junior Stocks and Shares ISA for growth potential. Learn more in our Stocks and Shares ISA guide.
- Grandparent control Bare trust savings or investments where you are trustee.
Getting started
- Decide on cash versus investing based on time horizon and risk.
- Check if a parent can open a Junior ISA so you can contribute.
- If you prefer to open it yourself, consider a bare trust at a bank or investment platform.
- Compare rates and terms, then set a standing order for regular gifts.
Useful links
- Junior ISA rules on GOV.UK
- Gifts and inheritance tax allowances
- NS&I Premium Bonds if you want prize based saving
Frequently asked questions
Can a grandparent open a Junior ISA?
No. Only a parent or legal guardian can open a Junior ISA. Grandparents can contribute once it is open.
What happens at 18?
Junior ISAs convert to adult ISAs in the child’s name. Bare trust and children’s savings accounts become fully controlled by the young adult.
Is money in a child’s account protected?
Eligible cash deposits with UK banks and building societies are covered up to £85,000 per person per authorised institution under the FSCS. Learn more in our FSCS guide.
Can I set conditions on how the money is used?
Not with a standard Junior ISA or bare trust. If you want conditions or later access, you would need specialist legal advice about different trust structures.
Summary
For most families the simplest route is a Junior ISA opened by a parent with contributions from grandparents. If you want to set something up yourself, a bare trust gives you a straightforward way to hold savings or investments for a grandchild. Choose based on access, tax treatment, and how much control you want until they turn 18.