Adrian Thomas started investing two years ago on behalf of his three children aged 11, 10 and eight. He started with an initial lump sum of £5,000 for each child's portfolio invested in five high-yielding FTSE 350 shares from different industries. Each child's portfolio is set up within a self-invested personal pension (Sipp), and they all have the same number of holdings.
Sipps
Provide income for children's retirement
"My objective for the children's portfolios is to provide a dividend income stream that will have a present value in 50 years' time at least equivalent to today's income tax personal allowance of £11,000," he says. "I want to give them a head start in their retirement planning now with something that I can hand over in 20 to 30 years without any inheritance tax implications.