KidStart The smart way to save for children

A new scheme has been launched to help parents save for their children while spending money.

Under KidStart a contribution will be paid into a designated Child Trust Fund or children's savings account every time people who have joined the scheme spend money at certain online retailers.

More than 200 online retailers have so far signed up to the scheme, including Mothercare, Marks & Spencer, Waterstones and Expedia.

Companies taking part offer returns of between 1 and 20 of the amount spent, with others offering lump sums of £50.

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So how does it work? Essentially, in a similar way to cashback sites - by signing up to KidStart and shopping through one of its many retailers you earn a percentage of your spend back as cash, which is deposited into your "Kiddybank" account. However, rather than claim the cash yourself, parents must link their child's saving account or even Child Trust Fund, if eligible, to their KidStart account.

Account balances are checked each month and when the balance exceeds the minimum deposit level (usually £10) the balance is transferred straight into your child's savings account. And there are a vast number of retailers to choose from. So every time you shop at John Lewis, Argos, Ocado, Tesco, Boots, Asda or House of Fraser, to name but a few, you could be adding money to you child's savings. Fantastic!

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Andrew Hagger from Moneyfacts.co.uk looks at the vast array of children’s savings accounts on the market and a recent innovative idea that will help boost the balances of young savers in the UK.
The recent launch of a new website www.KidStart.co.uk now makes saving for children even easier. Simply by doing your shopping online, your children or grandchildren can directly benefit on the back of your day-to-day spending.

“KidStart is basically a free children’s savings club, which allows parents to enter the details of their child’s savings account. Then, whenever they purchase online via over 200 well known retailers, a percentage of money spent automatically gets transferred to the child’s account. Parents can invite grandparents or other family members to sign up and before you know it, the child’s savings balance can really start to grow."

Elaine and Anthony Sharp signed up to KidStart two months ago to save for Louisa, their ten-month-old daughter.

Last week the couple, who live in Barnes, southwest London, spent £156 at Mothercare on a child seat and a safety gate.

Purchases from Mothercare earn 5, so £7.80 was added to a Child Trust Fund they opened with F&C when Louisa was born. "It is such an excellent idea," says Mrs Sharp. "Almost every time we use our cards to buy something, we are also contributing to our daughter's savings."

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Parents feeling the strain during the credit crunch may find they have little money left over to put away for their children’s savings.

But a new website was launched this week to help parents save money while they shop for everyday necessities. KidStart is a free children’s savings club which allows members to collect cash savings for their children when shopping at a wide range of online, and a growing number of high street retailers which offer savings of up to 20.

For many families, financial pressures make it difficult for parents to save extra money into the account. Dawn and David, 41 who valet cars, are not making any extra payments. Dawn says: "I really want to be able to put something away for them, but at the moment paying for food comes first". And with tightening economic conditions, trust fund providers are trying to find new ways to help families save.

The website KidStart.co.uk provides a way for families to shop and save at the same time. A proportion of the money spent with big-name retailers through the site is paid into any recognised child savings account.

A scheme that started yesterday worth considering is KidStart, which pays money into your child's savings account or Child Trust Fund when you shop on-line with stores such as Asda, Bhs, Marks & Spencers.

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As well as proactively squirreling some money away for your kids each month, you can actually boost their savings whilst you spend, as part of a recent initiative by a website called KidStart.

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