Junior ISA

A tax free payment

Our Junior ISA gives you the chance to talk to your clients about how they’re planning for their child’s financial future - and how you can help ensure that they receive a tax-free cash sum when they turn 18. They can start out with an investment of just £10 and make single or monthly investments, there’s no set period and payments can be changed at any time.

Stocks and shares

Our With-profits Junior ISA is a stocks and shares investment - we invest it in the Healthy Investment Ethical With-profits Fund. It’s a carefully managed fund that includes stocks and shares, company and government bonds, commercial property and bank deposits. The money that your clients put away now will grow through the regular bonuses that we add to the investment every year. (Remember though that bonus rates aren’t guaranteed, and can change every year).

A guaranteed return

Wouldn’t it be great to offer your client’s child a guaranteed, tax-free payout when they turn 18? Well, with our Junior ISA that’s what they get - for all investments held over 5 years, we guarantee they will receive all of the money that has been invested, plus all the bonuses that have been added. They may also receive a final bonus. For investments held for less than 5 years at age 18, we make this same promise on the 5th anniversary of every investment.

Only a parent or guardian of a child under 16 can open a Junior ISA, but once it’s open anyone can make more investments. Once they’re over 16 they can even open their own Junior ISA.

Your client’s child can only have one cash and one stocks and shares Junior ISA, so it’s important that you help parents to choose carefully which best suits their needs.

The Junior ISA is an easy way to grow a cash sum that will be really appreciated when the child turns 18. Your clients can make regular payments, or one off payments - for example when their child gets birthday or Christmas money.

We provide both Child Trust Funds and Junior ISAs, so if you’d like to discuss transferring a CTF to a Junior ISA, just let us know. We can’t offer advice, but we’d be happy to talk through the differences with you.

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Important Points

Is it for my client?

Available to any UK resident under the age of 18, who does not have a Child Trust Fund.

Junior ISAs can only be opened by parents or guardians of children under 16, but once open anyone can invest in them for the benefit of the child.

If the child is between 16 and 18 they can open one themselves.

You might consider this Junior ISA if your client already has savings for them in a bank or building society and are now looking to put some money in to an investment that has some risk but the potential for higher returns.

Invest up to £9,000 (2023/24 tax year) by adding a monthly amount or a single investment (both a minimum of £10).

If your client's child has a Junior ISA with another provider the parent of that child can transfer this into a Healthy Investment stocks and shares Junior ISA without affecting their current Junior ISA tax year allowance.

The regisered contact can transfer an existing Child Trust Fund to a Junior ISA.

You should see this Junior ISA as a medium to long term investment.

Things to think about

Although the Junior ISA grows through bonuses, bonus rates are not guaranteed and in exceptional circumstances could be nil.

There are no early surrender penalties on the advised Junior ISA, unlike if a client invests directly.

If they cash in, or make a withdrawal, a Market Value Reduction (MVR) may be applied, which, if not made on one of the guaranteed MVR free dates, could reduce the amount the child receives and they might receive back less than has been invested. A MVR may be applied if there’s a significant fall in the value of the stocks and shares, or other investments we have invested in.

If your client decides to invest into a Healthy Investment stocks and shares Junior ISA for them they will not be able to invest in another stocks and shares Junior ISA.

Inflation will reduce what the investment will buy in the future.

Tax rules can change at any time.

Our Ethical With-profits Fund

If your client decides to invest in a Healthy Investment stocks and shares Junior ISA, they will be investing into our Ethical With-profits Fund, which includes a mix of stocks and shares, fixed interest bonds, commercial property and cash deposits. The mix of assets held changes over time.

We avoid investing in companies in certain industries and those whose activities are not in accord with our members’ personal values. Examples are the tobacco, armaments, alcohol and fur manufacturing industries, gambling and pornography providers and companies that manufacture products or ingredients that have been tested on animals.

We seek to invest in companies that are explicitly involved in activities that benefit society and the environment. Examples are companies that are tackling climate change, promoting a low carbon economy, promoting diversity and equal opportunities, and improving energy efficiency.

Our vision is to invest for a better future, deliver good financial returns and make a difference to society and the environment.

The Society aims to provide a consistent return by smoothing the investment return to avoid volatile fluctuations in the value of your client's investment. Smoothing may not protect them against long term or sustained falls in the value of investments.

For further information on our Ethical With-profits Fund please click here.

Bonuses and benefits

Reversionary bonus
A reversionary bonus is an annual bonus which, once added to your Junior ISA, can never be taken away.

These are the reversionary bonus rates we’ve applied to our stocks and shares Junior ISA:

2022 – 2.25%
2021 – 2.25%
2020 – 3.00%
2019 – 3.00%
2018 – 2.00%
2017 – 2.75%
2016 – 2.50%

The level of bonus depends on investment performance, our expenses and our solvency margin over the previous year as well as the Board’s expectations of future performance. The level of bonus also reflects the capital and bonus guarantees. The rate of bonus can change every year and could in exceptional circumstances be nil.

All reversionary and interim bonus rates are net of charges. The bonus rate declared is the bonus rate you receive.

Interim bonuses
Unlike declared reversionary bonus rates, which can never be changed, interim bonus rates are not fixed and can be increased or reduced by the Board at any point during the year. The current interim bonus rates are based on a prudent view of future investment performance, solvency and expenses over the year. They are used for partial and full withdrawals made since the last reversionary bonus declaration.

Terminal bonuses
A terminal bonus is an additional final bonus which may also be added on partial and full withdrawals or in the event of the death of the investor. The rate of final bonus can be changed at any time or can be withdrawn altogether

Capital and bonus guarantees

The Healthy Investment stocks and shares Junior ISA comes with important capital and bonus guarantees to ensure that the child receives back the initial investment plus all the bonuses that have been added to their Junior ISA, providing they cash it in on one of the key anniversary dates.

The first key MVR free anniversary date is on the child’s 18th birthday, for all investment made before their 13th birthday and every 5th birthday after that. If the individual investment has been made for less than 5 years when the child reaches 18 the first MVR free guarantee will apply on the 5th anniversary of the investment and every 5th anniversary thereafter.

MVRs are never applied on death.

What could they get back?

The level of bonus depends on investment performance, our expenses and our solvency margin over the previous year as well as the Board’s expectations of future performance.

The Key Information Document includes examples of what your client might receive back based on different investment scenarios. It also helps you understand the nature, risks, costs, potential gains and losses of this product and to help you and them compare it with other products.

Download our latest Key Information Document for our Junior ISA here.

Single Regular

Consumer Duty

The Consumer Duty ensures that the needs of our members and your clients are always put first. As a mutual we’ve been committed to doing the right thing throughout our long history, however this new FCA initiative is, we believe, going to drive up standards across financial services.

As part of our commitment to supporting you, the advisers we work with, our Consumer Duty Outcome Assessment is available to help you demonstrate that by recommending our products you’re doing the right thing for your client.

Download our outcome assessment for our Junior ISA here.

Download

Important Documents

Single ISA Key Information Document
Download
Regular ISA Key Information Document
Download
Terms and Conditions
Download

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Working in partnership

Recommending and submitting business to Healthy Investment is easy. There are a number of options and all of our products can facilitate the payment of your fees.

All of the financial advisers we work with have their own dedicated Healthy Investment Business Development Executive.