Five things to consider when setting up savings for your child or grandchild

1. What should I invest in?

There are several options when saving for children, and a good strategy is to spread the risk by combining different savings methods. Investing in credits, for example via SaveLend, can be a great complement to other long-term savings options, providing steady returns and good risk diversification.

By combining multiple savings alternatives, you can achieve a balanced strategy where some funds remain easily accessible while others have the opportunity to grow over time.

2. How much should you save?

The most important thing is to save regularly, even if it's just small amounts. The compound interest effect ensures that even modest savings can grow significantly over time. Set a savings amount that feels comfortable and automate monthly contributions.

Remember, the key is to start – even small amounts can make a big difference in the long run.

3. When should you start and for how long should you save?

The earlier you start saving, the more time the money has to grow. Start as soon as possible, ideally when the child is newborn. Set a clear timeline and decide in advance how long you want to save and when the child should receive access to the money. A good approach is to plan for a gradual transition where the child gains more insight and responsibility for the funds as they grow older.

4. Saving in your own name – a simple solution

There is no problem saving in your own name, as long as you maintain a clear structure. On platforms like SaveLend, you can create separate accounts for each child or grandchild even if you save in your own name,, making it easy to keep track of the savings. Saving in your own name means that you can decide when and how the money should be transferred. This provides flexibility and control, rather than having the child automatically gain full access to the funds at age 18.

However, if you save for children in your own name, it is a good idea to regulate this savings in a will, for example, to ensure that the money actually goes to the child if something happens to you.

5. Inform the child – and potentially the parents

Talking to the child about savings helps them understand the importance of managing money wisely. Explain why you are saving and what the money might be used for. Teach financial basics by showing how savings grow over time.

If you are saving for a grandchild or a child with a different legal guardian, inform the parents about the savings plan. This creates transparency and makes it easier to manage when the funds are eventually transferred.

Summary

Saving for a child or grandchild is a great investment in their future. By choosing the right savings methods, saving regularly, deciding in advance when the funds should be transferred, keeping the savings structured in your own name, and discussing the plan with both the child and the parents, you can create a secure and sustainable financial strategy.

The most important thing is to start – a smart savings plan today can make a big difference tomorrow! Good luck with your savings.