Best account / method: Grandparents outside of CH sending money for saving to CH

Investing / Others
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Hi everyone, I’m fairly new to the forum, although have been lurking for some time :slight_smile:

I have searched and have not found a similar topic / discussion / answer, but apologies if I have missed something.

I’ve have lived in Switzerland (Vaud) for more than 2 decades, having moved from the UK. I have 2 kids born here, now aged 19 and 22, in apprenticeships.

My parents, still based in the UK, would like to set up a savings / investment account for my kids, to which they would regularly send money (maybe an initial lump sum, and then regular top ups). The idea being that this would grow nicely and be of use to the kids during their education if needed, or beyond that, increasing in value to be of use for some future needs. The amounts in question are not enormous but still quite significant - maybe an initial payment of around GBP 10k, and top-ups of maybe 500 per annum, per child.

My question is, does anyone have experience of doing this? In the UK it seems there are simple, tax advantageous accounts (ISAs?) that are kind of made for this sort of thing. I don’t know of anything relevantly similar here, but I’m also not 100% clear what ISAs are)

Some kind of 3eme pillier doesn’t seem to apply as they don’t yet pay tax with their apprentice income, and they are not yet in the retirement system either. I guess if it was in the children’s names then they would declare it as fortune on their impots, or perhaps as gifts - tbd.

My thoughts are either a simple savings account (eg Caisse d’Epargne Aubonne 1.5%) which pays a better than usual interest - but that still seems pretty low return.

Is there a simple / automated investing account that would be more suitable?

Any thoughts gratefully received.

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It’s a bit unclear what properties you want this setup to have.

For example, should the kids have control over it (e.g. if next day they decide to withdraw it and spend, is that fine with you)?

“this would grow nicely and be of use to the kids during their education if needed, or beyond that, increasing in value to be of use for some future needs” → the default for this would be some portfolio with a significant portion invested in stocks, either with traditional low-cost online brokers (e.g. Interactive Brokers, Swissquote, etc.) or roboadvisors (e.g. Truewealth). However, if this would be used for education of a 22yo, that does not sound too much in the future? So it depends on the time horizon of when you think the money will be spent

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There is no Swiss equivalent. The assets will be considered your assets for tax purposes, and must be declared as such.

There are accounts and investment solutions that can be opened in the child’s name. The possible advantage compared to you investing for them is that the service provider might limit your access to the money (in case that is an issue for the gifters). However, until the child turns 18, the assets are still considered yours for tax purposes, and must be declared as such. Once the child turns 18, they assume tax ownership of the assets.

Take a look at the investment plans for children from Finpension and True Wealth if you want to invest in stocks, etc.

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the simplest way ist just do a VIAC invest sub account for a child, they put the money there and you are good to go.

More complex (and a bit cheaper) you go with interactive brokers.

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5

You mention amounts, but not the time frame.
As you and rez commented, they are in their education, already… And of legal age.

I’d involve the kids, let them pick with some instructions around it.

That could be the deposit for an own apartment plus furniture, or an used car.
If that’s needed in the near future, your parents might as well hold on to it a bit longer and then offer to pay for that directly.

Or if they fancy the long-term aspect, offer to pay the first year of 3a once they can, or let them invest it with a broker of their choice for own property, studies etc. in the future.

Unless it’s a broker like IB where they could send GBP directly to, it’s properly easiest to transfer the cash to CH with low FX fees and then take it from there.

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Your children are not that young anymore, I would involve them in the process of investing.

If the money is needed in the short term (<10y) I would not put it into equities. Maybe you could do 2 pots (short and long term).

I think viac/finpension invest is a good option.

Of course max 3a as soon as possible.

Show them this forum and buy them a Bogleheads book.