Savings that are put into a Child Trust Fund (CTF) can be strengthened by using further savings plans such as a pension, according to a leading financial advice firm.
A CTF is a long term investment plan and can be saved into by parents, family or friends at a maximum input rate of £1,200 per year.
The government also provides a £250 pound voucher toward the fund to all those children born on or after September 1st 2002.
However, solely relying on this fund can be a risky strategy for parents, as there is a danger that the child may rapidly spend the savings after gaining access to the money when aged 18.
Commenting on the benefit of setting up a pension for your child alongside a CTF, Anna Bowes, investments manager for AWD Chase de Vere, said: "I think a pension is a great idea. When they get to that retirement age and they've potentially got a very large sum of money in their pension, and that's going to give them a good, safe income."
AWD Chase de Vere is one of the UK's largest Independent Financial Advisers with over 400 professional advisers.
Find out more about pensions
© Adfero Ltd