Ask Paul: Where can we start investing for our newborn?
We have recently had a baby boy and would like to set up some form of investment or account where we will deposit money on a regular basis.
Our intention is that he will access it later in life.
What do you suggest would be a suitable course of action that has limited risk but will tick over until the time comes? - Rob
A. What a great idea, Rob!
My parents did this for me from birth with not a lot of money each year and in my mid to late 20s it made a huge difference to buying a home and starting my business.
We did the same with our three kids and are about to do it again with our new grandchild.
I suggest an exchange traded fund (ETF) where you can make regular contributions.
The huge and very low-cost managers such as Vanguard and BlackRock are an easy way to get a global or balanced-type fund.
Dollar cost averaging and compound returns will do the heavy lifting for you.