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Aug 2020

Best Junior ISA Funds: Our Top Picks 2020/21

Best Junior ISA Funds: Our Top Picks 2020/21

Whether you are a parent, grandparent or guardian of a child, you will want the absolute best for the little one you care for. Taking out a Junior ISA account for them is a fantastic way to set them up for some financial security – especially within the tax-free ISA wrapper. But which are the best funds for this year? We’ve put together our top five picks for you to choose from. 

Choosing to open a Junior ISA for your child is a great way to invest in their future in a tax-efficient way. Junior ISAs can set children up for the start of life: they can help your kids with the deposit for their first home, with learning to drive, with university or college costs – the list goes on and on.

With JISAs, you’re likely to be putting money away for a longer period of time. In that case, you will get better returns and better results from choosing a Stocks and Shares JISA. You should aim to invest for at least five years, as this gives time to account for the normal fluctuations in the market.

Like any other investment, choosing the right account for you, and for your child, is important. To help you make your choice we have put together a list of our top five picks for Junior ISA Funds. 

1. Baillie Gifford Scottish Mortgage Investment Trust

This is a low cost equity investment trust which invests worldwide with a curated selection of stocks including Tesla, Amazon and Netflix which makes up over 20% of the fund holding, chosen for their strong growth prospects. You can invest from as little as £50 per month. This fund is actively managed, and aims to maximise the returns gained in the long term. The fund has a very respectable ongoing charge of 0.36% pa.

You can access this fund via a junior ISA using fund platforms  Interactive Investor and Hargreaves Lansdown

2. L&G Global Technology Index

The Legal and General FTSE Global Technology Index Fund ISA is a great low-cost fund which allows you to invest in global companies which are engaged with information technology activities. This technology tracker fund invests in companies such as Apple, Microsoft and Google which currently makes up over 30% of the fund holding. The minimum you can invest as a lump sum is £100, but you do have the option of investing from £20 per month. The fund has a very respectable ongoing charge of 0.32% pa.

You can access this fund via a junior ISA using fund platforms  Hargreaves Lansdown and Interactive Investor

3. iShares FTSE 100 UCITS ETF

This  ETF tracker fund enables you to invest in FTSE 100 companies via the index of the largest companies listed on the London Stock Exchange including Astrazeneca, Glaxosmithkline and HSBC. This fund has a proven record of tracking stocks with a very high degree of accuracy and gives investors exposure to FTSE 100 companies. You can invest in this stock from £50 per month. This fund has a super low ongoing charge of 0.07% pa.

You can access this fund via a junior ISA using fund platforms  Interactive Investor and Hargreaves Lansdown

4. Fidelity World Index

This fund is a low cost and straightforward way for someone to start investing into a fund. There is a very low charge management cost of 0.1% per year. The fund tracks the performance of the MSCI World Index (before the fees and expenses are applies) and by doing this, they will aim to make good returns on this basis. They invest in many well known companies you might recognise – including Coca-Cola, Google, Disney and Microsoft. The fund has a very low ongoing charge of 0.12% pa.

You can access this fund via a junior ISA using fund platforms  Interactive Investor

5. Fundsmith Equity

This is a popular fund which invests in typically 20 to 30 stocks, including high quality businesses which can sustain giving high returns on capital including Microsoft, Paypal and Facebook. It has grown approximately £20 bn since it launched in 2010. You can begin investing with a minimum of a £1000 lump sum or £50 per month. The funds has an ongoing charge of 0.95% pa.

You can access this fund via a junior ISA using fund platforms  Hargreaves Lansdown and Interactive Investor

Read more about Junior ISAs

Important Risk Information:

The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website aims to provide information to help you make your own informed decisions. It does not provide personal advice based on your circumstances. If you are unsure of how suitable an investment is for you, please seek personal advice.

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Invest for your child’s future

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You've decided to invest your savings into a Stocks and Shares ISA. You'll be using your tax-free ISA allowance for this year before the deadline, while also investing your money for your future. But what do you need to consider before opening an account? We've put together a list of our top five considerations for you to think about before you click "apply". 

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