Savings Account for my kids
- Thread starter Robbiep
- Start date
You can open a super account the moment you've got a name.
Compounding interest on $10k over 65 years yields a very nice result. If the government did this instead of a baby bonus and pension, we'd all have a very nice retirement without anywhere near the burden on the taxpayer.
I can solve Australia's social security problems very easily. It'll just take 60 years to come to fruition.
Compounding interest on $10k over 65 years yields a very nice result. If the government did this instead of a baby bonus and pension, we'd all have a very nice retirement without anywhere near the burden on the taxpayer.
I can solve Australia's social security problems very easily. It'll just take 60 years to come to fruition.
Bankwest is an 8% account which gets dumped into a low interest account ever 12 months. The day after its dumped i transfer the full amount into a suncorp kids saver at 4.65%. Then i can continue to put in $200/month into BW again at 8%. Rinse/cycle/repeat.
Problem is now that kids can earn only $416 interest before they are slugged with 66% tax. I can claim the whole amount as my own income and so i will pay tax at my rate but either way i dont want to pay tax. I will probably shift all the money into my offset account so the kids only make $416 a year and pay them back one day.
I wish to invest in REITS, Bonds, shares for kids but i think the $416 income a year rule still applies to under 18yo's (unless there working)
Problem is now that kids can earn only $416 interest before they are slugged with 66% tax. I can claim the whole amount as my own income and so i will pay tax at my rate but either way i dont want to pay tax. I will probably shift all the money into my offset account so the kids only make $416 a year and pay them back one day.
I wish to invest in REITS, Bonds, shares for kids but i think the $416 income a year rule still applies to under 18yo's (unless there working)
Can anyone suggest a good super company for kids that has made consistent positive returns and has a low annual fee?
So far im thinking of putting the kids money in HostPlus at (averaging ~ 6% over 10 years) with a minimum $78/ year in fees.
http://www.hostplus.com.au/super/super-with-hostplus/fees-costs
So far im thinking of putting the kids money in HostPlus at (averaging ~ 6% over 10 years) with a minimum $78/ year in fees.
http://www.hostplus.com.au/super/super-with-hostplus/fees-costs
The question is whether you really want to lock away money for your kids that they can't access tax efficiently until they're in their 60s (most likely older, given the trend).
They'd be better off inheriting it off you via a testamentary trust.
Youre thinking of putting money away for your kids that they can access when they're 65?
And you think a super fund will fit that requirement?
If you or you're spouse have a low income, it may be easier to put the money in the parents name with the lowest income as a trustee for the child
Only if it's a formal trust Terryw.
Banks will let you open an account that states it's in trust for a child but the parent is the legal owner, sole signatory and has their TFN on the account. Legally the money still belongs to the parent, they have just designated a purpose for it. I think that's the setup that BMW was talking about.
I can't remember who asked but no, TFNs aren't compulsory for children. Up until the end of the year that the child turns 16 the Tax Exemption code of 333333333 can be used instead and no tax is withheld unless the account earns more than $420 in a year (roughly your interest on a $10k balance at the moment).
For the person who's father had tax withheld, he should check with the bank about how the account is set up. If he is the owner of the account they can put his TFN on and no more tax will be withheld. They may reverse the amounts withheld during the current financial year immediately but anything older has to be claimed back from the ATO, either on a tax return or on a special form on their website if he does not normally complete a tax return. If the account is in the childs name and your father is only a signatory then they will need the childs TFN (or if the interest is under $420pa they should use the exemption code). Same method for claiming previously withheld amounts from the ATO.
Banks will let you open an account that states it's in trust for a child but the parent is the legal owner, sole signatory and has their TFN on the account. Legally the money still belongs to the parent, they have just designated a purpose for it. I think that's the setup that BMW was talking about.
I can't remember who asked but no, TFNs aren't compulsory for children. Up until the end of the year that the child turns 16 the Tax Exemption code of 333333333 can be used instead and no tax is withheld unless the account earns more than $420 in a year (roughly your interest on a $10k balance at the moment).
For the person who's father had tax withheld, he should check with the bank about how the account is set up. If he is the owner of the account they can put his TFN on and no more tax will be withheld. They may reverse the amounts withheld during the current financial year immediately but anything older has to be claimed back from the ATO, either on a tax return or on a special form on their website if he does not normally complete a tax return. If the account is in the childs name and your father is only a signatory then they will need the childs TFN (or if the interest is under $420pa they should use the exemption code). Same method for claiming previously withheld amounts from the ATO.
She is 4 years old, Super fund would pay out in 61 years. I wanted something to pay out when shes looking to move out of home in 15-20 years.
Chillax, by that stage the government will have changed the rules sufficiently so that young people can access their super to purchase their first home.
It will be called, 'the first home super boost grant' and will involve FHB making it their PPOR for at least 24 months and having the super fund invest in a portion of the properties equity.
