Welcome to the oldest still alive thread in this forum:
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I have young kids and don’t invest for them. Maybe if I was in the UK where they have specific products for kids (Junior ISA, Junior SIPP) I would do so, but I don’t see any point. I might as well just invest money myself and give it to them when they are older.
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Hello everyone,
I’m planning to make an investment for my daughter, who is currently three years old. Initially, I thought about investing 100 CHF per month in stocks, but now I’ve decided to increase my budget for her future.
Here’s my current plan:
- 100 CHF per month for stocks
- 100 CHF per month for crypto (with 70% in BTC and 30% in ETH)
If I had started this investment from her birth, I would need an initial investment of 7,200 CHF (3,600 CHF for stocks and 3,600 CHF for crypto).
Regarding the stocks, I’m considering using Interactive Brokers (IB). As far as I know, it’s best to invest every three months to minimize fees. For crypto, I plan to open an account in my wife’s name or using a cold Wallet (I have already a Ledger).
Here are my questions:
- Tax Implications: What are the tax implications of investing in stocks and crypto in Switzerland? Are there any tax-efficient strategies I should consider?
- Fund Selection: Which types of funds should I choose for the stock investments? What criteria should I base these decisions on, and should I adjust the portfolio over time?
- Inheritance Planning: If something happens to me or my wife, how can I ensure these investments are properly managed and transferred to my daughter?
- Overall Strategy: What do you think about my investment plan? Are there other opportunities or adjustments I should consider for my daughter’s future? (she is a Swiss citizen)
Thanks in advance
Hi everyone,
I look for a “fire-and-forget” solution, something easy which does not create headaches for Tax declaration too.
Situation:
- Degiro with 6 stocks. Almost forgot about them, I just keep an eye from time-to-time.
- PostFinance with some cash (in both CHF/EUR) sitting in the “savings account” without doing really nothing and getting an very insignificant amount at the end of year.
- Gold (phisical) and watches (not sure if this can be called an investment btw).
- 3A, linked to mortgage
I need to confess, I am not really talented with checking and stay up-to-day with investments, and furthemore, very little time to focus on that.
I was told about Findependent, but I gave up with all the questionnaires with the enrollments.
I opened 2 PF accounts for my two little ones, where I put some money.
I look for something very easy to use, where I can put the money from PF (from the kids’ accounts) and keep with a monthly investement, and possibly to re-use what I have (DeGiro, Post Finance, or Yuh which I use mainly for CHF/EUR conv and card transaction abroad).
Thank you
Cap
Have you already checked out Truewealth child accounts? I am using it, it is very much setup-and-forget. While looking into this topic, I have checked out the offers. Most offers (also findependent) are just portfolios in your name with a label for the child. The only real child accounts I have found were Truewealth and UBS. If I remember, UBS was slightly more expensive because of the product TERs.
If you do not care that the account is in your name, you could also go with IB, which would be less expensive.
The nice thing of having an account in the name of the child is that you do not need to sell ETFs when the child turns 18. In my case, also grandparents and godfather is using it, which works nicely (all pay into the same IBAN and it gets invested automatically).
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It’s been said before, but here a repeat
- Use the same broker you already have
- Buy a world ETF, just pick a different ticker from what you already use (e.g. FWRA instead of VWRL)
- When time comes and you want to give that to your child, sell/transfer the amount/stocks
All other “child only” accounts come with limitations which you’ll later face (unless you are really seeking to have them).
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Yes. IMO, the best way is not to invest for the child, but invest yourself and give to the child later.
Unless you absolutely need to have the legal separation and all the complexities that entails.
Just look at the past posts on people on here where they were unable to access the funds to use for the child afterwards and it was locked in until the age of adulthood.
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Wouldn’t this be good in theory be good, provided one a) REALLY don’t invest what they won’t miss and b) leaving it compounding for a long time far from anyone’s touch?
For myself I’m doing as you’re doing, ie investing and intending to pass on specific stocks to them when they come of age. I wish someone had done this for me too, by the way. Or maybe not, my parents bought property so I don’t have to 
In this particular case, the parent wanted to move the funds from a bad investment to a better performing one and was blocked.
But in theory yes, depending on the product. I’d be happy to put something into, say a UK Junior SIPP where it could remain untouched for decades. It also makes sense to protect the child from the donor changing their mind later.
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We use it as well.
Easy to use and does the job
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Wouldn’t a IBKR sub-account be a suitable solution?
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I heard such roboadvisor (same as Findependent) gives headache when it comes to the Tax declaration. Any reason for that?
No reason for headaches whatsoever.
The E-Steuerauszug is provided for free with findependent.
Somehow I recall reading into other threads, about complexity on tax declaration with robo advisors…
Is the E-Steuerauszug provided for free also for Truewealth?
Yes, they do: Does True Wealth also provide an electronic tax statement?
Also I had no issues with tax declaration last year with this solution, just uploaded it to my tax declaration and that was it.
Regarding all this, I’m also into those robots for my child just because it’s easy and in CH.
So my question is, what robot has lowest fees? Best overall?
- Findependent with 5000chf fee free with QoQa today
- Finpension and get time to time 25.- with promo code
- True Wealth
Thanks for advices.
My answer is a bit long, but I’ve been meaning to share my experience with investing for our kids in the hopes it could help others with similar needs.
If I had to choose a Swiss solution, in my kids’ names, it would be TrueWealth.
It’s a simple solution, overall, which anyone can directly transfer funds to and seems to offer the lowest fees (at a glance) when investing with a global equity focus vs other CH ROBOs.
We decided we’d only open such an account if friends & family requested it or ended up making a large enough cash donation. A piggy bank is more than enough for the occasional small cash values they receive.
Personally, we decided with the birth of #1 that we preferred to invest in our names in order to retain complete freedom of choice in terms of the investment solution used (potential lock-ins when in the name of the child) and be able to decide if/when/how much we ended up giving to our children (i.e., no requirement to hand over the amount in full when they hit 18).
For our kids we each invest 50.- per child (total 100.-).
For #1 I was investing that money with my personal IBKR account and tracking everything in excel.
With the birth of #2 this year, we decided this was no longer optimal for several reasons:
- A separate account helps separate the kids’ money from my/our money, both when reviewing the monthly numbers and as a reminder for the long-term that this is setup to be gifted.
- It wasn’t ideal in case I die, for inheritance tax reasons in Canton Vaud for unmarried couples.
- It wasn’t ideal in case I die, as the Mrs isn’t all that comfortable with my Excel no matter how I simplify it.
This year we finally setup a sub-account per child at Interactive Brokers (opened via settings > “additional account”) under my individual account. Both were setup as “Joint Accounts - Tenants in Common” (i.e., standard rules of succession apply). The Mrs has her own login for each of these accounts. Same as for my account, these have been setup with Cash/Tiered pricing. To avoid any confusion when switching between accounts, I’ve defined custom aliases for each account.
We now top up these accounts directly from our joint account (at Neon 
) and have the process pretty much automated with recurring investments to VT (defining a monthly value in USD, leaving a couple of francs worth to spare for fees/auto-conversion from CHF) and with dividend reinvesting activated. Over time I may have to execute the odd manual purchase for leftover cash or adapt the USD amount per current exchange rates or changes in contribution amounts.
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Yeah I consider accounts that are not in the name of the child a feature. It can be a real pain in the ass in some cantons to move money around, and it has to be included in the parents’ taxes anyway.
Also, I wouldn’t want to give a child access to a larger amount of money when they turn 18 (which automatically happens with accounts in the name of the child). They should have been working for a few years and learned how to manage money first.
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Keep in mimd that Truewealth fees are 0.25% when you have an account for yourself and recommend it once a year to a friend. So far, I have never paid full 0.5% per year. This makes the offer the cheapest of the setup-and-forget ones.
Good evening everyone,
I’m a beginner in the world of investment and I’d like to know you opinion on a investment strategy for a child, so long term, at least 20 years with a monthly investment, not too much, around 200 chf.
Reading thepoorswiss blog I found out that Finpension has just started Invest Wealth (outside 3a pillar) with a 0.39% fee.
What do you think of the fund they offer Finpension global equity 100? Is it a solid fund? I mean is it like investing in a etf world?
Do you think they have better choices?
Should instead choose something like Investart.ch? Fees are lower (0.3%) but Finpension seems more professional to me (maybe this is only a bias).
I know a broker is much cheaper, but I feel more comfortable with a roboadvisor, and maybe they provide etax statements as well.
Thank you