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Children's Bonds

For their future

Invest for your children today and see them enjoy tax-free benefits tomorrow

Children's Bonds: facts and figures

  • Rate 2.50% tax-free/AER Issue 35
  • Term 5 years
  • Tax Tax-free

Suitable for savers who:

  • want a long-term, tax-free investment for their child’s future
  • want to know exactly what return their child will get
  • can leave the investment for five years at a time
  • have £25 or more to invest

Not for savers who:

  • want to invest for a young person over 16
  • want an account that their child can control
  • think their child might need access to the money early
  • are not the child’s parent, guardian or (great) grandparent

Investing in Children’s Bonds

Summary box

Account name

NS&I Children’s Bonds

What is the interest rate?

5-year term, Issue 35

2.50% tax-free/AER

We calculate the interest daily and add it to the Bond on each anniversary of investment.

Can NS&I change the interest rate?

You’ll receive the rate on offer at the time you invest and that rate will be fixed for the 5-year term. We can change the fixed rate on offer at any time. Each time we change the rate on offer we release a new Issue of Bonds.

What would the estimated balance be after 12 months based on a £1,000 deposit?

A £1,000 deposit would be worth £1,131.41 at the end of the 5-year term.

This is an illustration only, so it doesn’t take into account your individual circumstances. It assumes that you don’t make any withdrawals during the term.

How do I open and manage my account?

Our Children’s Bonds are for customers aged 16 or over to buy for their own children, grandchildren or great grandchildren under 16. The Bonds will be in the child’s name but their parent or guardian will need to look after the investment until the child is 16.

If you’re the child’s parent or guardian, you can:

  • apply for, and manage, Bonds online, by phone or by post
  • invest with at least £25, paid by debit card or personal cheque drawn on a UK bank account in your name
  • invest up to a total of £3,000 per Issue for each child

Grandparents and great grandparents can also apply for Bonds, but only by post.

If you want to switch to a Children’s Bond from another NS&I account or investment:

Download an application form

Call us

Can I withdraw money?

Yes, before the end of the term you can cash in all or part of the Bond online, by phone or by post with no notice. We will deduct a penalty equal to 90 days’ interest on the amount you cash in. You need to keep a balance of at least £25 to keep the Bond open.

At the end of the term you can cash in with no penalty. We’ll contact you (or the child if they are over 16 at the time) about a month before to explain the options available at that time.

Additional information

The interest earned is tax-free, both for the child and the parent or guardian, so it won’t count towards your Personal Savings Allowance.

Find out more about tax and savings

We’ll send you a statement shortly after each anniversary of investment, showing the interest earned and any withdrawals you might have made.

Definitions

Tax-free means the interest is exempt from UK Income Tax and Capital Gains Tax.

AER (Annual Equivalent Rate) illustrates what the annual rate of interest would be if the interest was compounded each time it was paid. Where interest is paid annually, the quoted rate and the AER are the same.

Managing the Bond

Managing the Bond

While the child is under 16, only the nominated parent or guardian can manage the Bond. Once the child reaches 16, they will look after the Bond themselves.

The person who looks after the Bond can register for our online and phone service then log in or call us at any time to check the balance or cash in the Bond.

Or they can give us instructions by post.

On each anniversary we’ll send a statement to the person who looks after the Bond, showing the interest earned and the value of the Bond.

  • What happens at the end of a term?

    Around a month before the end of each 5-year term, we’ll write to the person who looks after the Bond to explain the options available at that time.

    Don’t forget to let us know of any change of address or contact details so we can get in touch.

    How do I change my address and other details?

  • Cashing in

    The person who looks after the Bond can cash in at the end of a 5-year term with no penalty.

    You can also cash in before that, but we will deduct a penalty from the payment equivalent to 90 days’ interest on the amount cashed in.

    When you cash in part of a Bond, at least £25 must remain in the Bond to keep it open.

    How to cash in

    Registered for our online and phone service? Log in or call us at any time with your NS&I number and password to hand.

    Log in

    Call us

    Or complete a cashing in form and send it to us.

    When you cash in online or by phone, we’ll send your payment within three working days. When you do this by post, we will send your payment within five working days.

Apply now