We’ve answered the most common questions we get asked on Investing for Kids.
- How do I set-up a kids account?
- What account types are there for kids accounts?
- Can I have multiple kids accounts?
- Is the account in my name or my kids?
- How are the investments taxed?
- What happens when they turn 18?
- What’s the minimum to start investing?
- Can I top-up the portfolio?
- What’s in the portfolios?
- What investment strategy is right for my kids?
- What are the fees?
- Are there any exit fees?
- Can I access the funds any time?
- Is there a lock-in period?
- Is Stockspot Safe?
- Is Stockspot an Investment Bond?
- I have more than 1 child, should I create multiple accounts?
- How can I contact Stockspot?
1. How do I set-up a kids account?
Head to the Stockspot homepage to start your application.
Select ‘Get Started’ then enter an email and password to create your account. Choose ‘Kids’ from the list of account types and choose to invest as an individual on your child’s behalf, or through a trust (such as family or discretionary trust) where your child is a beneficiary. Under the trust option, you must have a formal trust, established under a trust deed.
Next, step through the questions to get your portfolio recommendation and complete the online application process. It should only take a few minutes.
Once your application is complete, we’ll review it and set-up your account (usually within 1 business day). We’ll email you the cash account details, then you can deposit funds for investment whenever you’re ready.
2. What account types are there for kids accounts?
You can open a kids account as an individual or through a formal trust, such as a family or discretionary trust, established under a trust deed.
3. Can I have multiple kids accounts?
Yes. There’s now a few ways you can set-up multiple kids accounts!
1. Stockspot Website – using different email addresses
For each new account, start a new application via the Stockspot homepage. You’ll need a different email address for each account as it’s used as the unique login ID.
We can help you to link the accounts once they’re set-up. Just email us to request it.
2. Inside your dashboard – using the same email address
You now can open multiple kids accounts (or any account type) within your existing dashboard.
In your dashboard, click on the arrow next to your account name (in the top left hand corner of the screen), then select ‘Create New Account’. You can proceed through and set-up additional accounts, using the same email address.
All accounts will be linked under the same email so you can have one login to access all of your accounts.
4. Is the account in my name or my kids?
Kids accounts must be in the name of an adult (usually mum, dad or a relative) on behalf of the child otherwise through a formal trust, as children can’t legally own investments in their own name until they turn 18 years of age.
We offer two options to invest for children:
a) You can invest as an individual client. The investments are held in your name from a legal and tax perspective, but we can add your child’s name to the account which acts as an identifier.
b) You can invest on behalf of a child if you are a trustee of a family trust or discretionary trust and your child is a beneficiary. From a legal and tax perspective the assets are held by the trust.
5. How are the investments taxed?
Any income or crystallised capital gains (or losses) incurred during the tax year, form part of the primary account holder’s assessable income each year.
Most of the capital gains implications are deferred until future years when you choose to either sell down the portfolio or transfer the holdings over to your child (where they must be 18 or older).
We help make tax time easy, issuing you with tax documents each financial year, including an Annual Investor Statement which summaries all your earnings, offsets and any deductions across the whole portfolio.
We recommend speaking to your tax adviser to understand the best option for you.
6. What happens when they turn 18 (or older)?
You have the option to transfer the investments to your child as an Off-Market Transfer (OMT) so that they become the new legal owner of the investments ie. a change of beneficial ownership from you (or the trust) to your child. Your child must be 18+ to complete an OMT. Reach out to our team to understand more about OMTs and any associated administration costs.
Alternatively, you can sell down from the portfolio and repurchase the investments in their name, or gift them the cash.
There can be tax considerations with both, so please speak to our team or contact your tax adviser to understand the best option for your circumstances.
7. What’s the minimum to start investing?
$2,000. You can also add smaller amounts to gradually build your way up to $2,000.
8. Can I top-up the portfolio?
You can top-up your portfolio anytime by setting-up a regular transfer from your external bank account to your Stockspot cash account.
Funds are automatically invested each time there’s $500 in your cash account (for portfolios less than $50,000) and $2,000 (for portfolios above $50,000).
For example if you were topping-up with $200 per month, the funds will be invested automatically around every 5 months.
Automating top-ups is a smart option to ensure you’re regularly adding to your Kids account.
9. What’s in the portfolios?
The portfolios include a mix of growth investments (Australians and global shares) and defensive investments (bonds and gold) to grow and protect your money along the way.
We use Exchange Traded Funds (ETFs) in the portfolios, providing instant diversification for a very low cost.
For portfolios less than $10,000 we phase in the ETFs gradually to optimise the level of risk versus return for smaller account balances.
Tip: Read more about the role of shares, bonds and gold in your portfolio.
10. What investment strategy is right for my kids?
You’ll be recommended a strategy that best suits your investment time horizon and comfort with risk.
Typically we recommend a growth strategy eg. Emerald or Topaz given the longer investment time horizon for kids investment accounts.
11. What are the fees?
Kids invest for free up to $10,000 or until they turn 18. Then the normal Stockspot fees apply.
Stockspot fees are all inclusive. There are no extras or hidden costs.
12. Are there any exit fees?
No. We don’t charge any brokerage, exit fees or transaction fees for withdrawals.
13. Can I access the funds any time?
Yes. You can withdraw anytime from your Stockspot dashboard. We will transfer the funds to your linked bank account. The process takes 4-5 business days.
14. Is there a lock-in period?
No. You can access your funds anytime. Although investing should be for the long term for the best results.
15. Is Stockspot Safe?
You are the legal and beneficial owner of your investments with the investments owned under a unique Holder Identification Number (HIN) – which is the safest way to own investments.
In the unlikely event something happens to Stockspot, you have the option to transfer your holdings to another provider.
You can read more about how Stockspot keeps your money safe.
16. Is Stockspot an Investment Bond?
No. We don’t recommend investment bonds since they tend to have high fees and poor long term returns. Learn more about investing into a diversified portfolio with Stockspot compared to an Investment Bond.
17. I have more than 1 child, should I create individual accounts for each child or combine accounts?
For parents with more than 1 child, there are two 2 options:
1) Create a single, combined account. You can add all the children’s names in the ‘on behalf of’ section in the application, which will show in the Stockspot dashboard and app.
2) Create separate kids accounts, so they can be managed individually. Each kids account will have its own cash account.
18. How can I contact Stockspot?
You can reach our local team by phone, email or live chat. Our Contact Us page has all the information you need.
Still have questions?
If you still have questions, don’t forget to visit our comprehensive list of FAQs.
