Congratulations!
I have to admit I have ended up with a whole mixture of accounts, partly because when my first two were born they qualified for CTF accounts. So any grandparent/great uncle/aunt cash got added to the Governments £250 bung. These were subsequently converted into JISA accounts, and when my third came along I opened a JISA and subbed the £250 to give them equal footing.
Primary benefit for the JISA, is that Grandparents/in-laws might feel happier giving money directly to the children's account. I have all my JISA (stocks and shares) with AJ Bell who charge a 0.25% fee on all three accounts. If I was to do it now I might go for Selftrade who charge a flat fee, but only one for all accounts.
I have cash savings accounts with the Halifax for the first two (These started off as regular savings accounts, but got migrated), but as interest rates are so low (and there is the tax free threshold now for interest) I have not bothered opening an account for my youngest, I just keep the money in a savings account linked to my own current account.
I would open individual savings accounts for the children again if:
- It was convenient - when I did it you had to make an appointment in the branch, not so great having to take a day off work
- It was giving a significant higher saving rate than one I could get
- It was linked to an account I already have (e.g. Halifax ones are accessible from my own Halifax online banking log in).
Otherwise I would just put the money in my own ISA and keep a track in a spreadsheet.
On balance I think it is possible to open a child savings account with Halifax online now, so although the rate is not brilliant 2% if under £5000, I would open the Halifax account. In fact it looks like you can open the regular saver online that would give you 4.5%.
I also have a proportion of my own Stocks and Shares ISA allocated to all three children, every month I add a small amount of money to the account and that buys them all more units in the overall portfolio.
I do this as it is not economic to buy/sell shares if the relatively small amount of capital each child has is split across 3 accounts. So I lump it all into one pot and they all take a share in the profits/dividends as the portfolio progresses.
I track how much each child has in a spread sheet, so there is a certain amount of overhead each month, updating the portfolio's current value and then 'buying' the units in the portfolio.
But I do this anyway for my own peace of mind, so its only a few more minutes effort.