Parents not interested in Junior Isas: JP Morgan

The survey of 2014 people revealed the biggest concern for 94 per cent of parents was that their children could struggle financially when they grow up. A further 22 per cent said they were worried their children would not have enough savings when they reached adulthood.

However, only 35 per cent of parents said they would consider opening a Junior Isa for their child.

Keith Evins, head of UK marketing for JP Morgan Asset Management, said: “It is not surprising such a high proportion of parents were concerned about their children’s future, particularly from a financial perspective.

“However it is alarming that only 35 per cent of parents were considering opening a Junior Isa. It is important parents understand there are few tax-efficient ways of saving and investing for the long term and a Junior Isa is one of the simplest.”

He said the study also showed that among parents who would consider opening a Junior Isa, more than one-third would sacrifice their own Isa contributions to put money into their child’s fund.

One in 10 would use up to 50 per cent of their contribution allowance and a further 16 per cent would use 25 per cent or less.

Mr Evins said: “The fact that parents were willing to sacrifice some of their own Isa contributions to help fund their child’s future shows their commitment to investing for the future of their children.”

JP Morgan has launched a Junior Isa, that offers access to funds from more than 30 UK asset managers and includes investment trusts, equities, exchange-traded funds, gilts and bonds.

The account can be opened with a £100 lump-sum or with contributions of £50 a month. There is no initial charge or annual account fees, apart from a £10 transaction charge on equity trades.

Mr Evins added: “It is important to choose a Junior ISA provider that offers choice and flexibility.”

Nick Lincoln, director of Hertfordshire-based Values to Vision Financial Planning, said: “I have some clients with young children but I have had zero interest from them on Junior Isas.

“I am not a fan of them because the child has complete access to the funds at 18. For that reason they are extremely poor and I would not recommend them to clients. If it were not for that, the Junior Isa would be a nice tax wrapper for children.

“Most people are not able to use their full Isa allowance so I would recommend that parents use their own Isas to make contributions and earmark some of those funds for their children.”