Let Santa help secure your kids’ financial futures: the wisdom of gifting investment trusts
Technology & Technology Innovation sector tops performance charts and average investment trust returns £4,600 on £1,000 over 18 years.
After repeatedly watching your children shrieking with delight as they open Santa’s presents, only to see them discarded days later when the novelty wears off, many parents and grandparents might want to consider a gift that has a longer lasting impact.
Rather than slipping a fiver into a Christmas card, a contribution into an investment trust has the potential to be life-changing. Certainly, the children will be thanking you for it long after they’ve discarded that mini drone kit they’d been begging for.
With ever increasing financial demands on young people, parents and grandparents could consider making an investment to give their child a financial leg up. A modest amount invested now could help with buying a car, a deposit for a first home or university tuition fees.
Nick Britton, Research Director of the Association of Investment Companies (AIC),
If a parent or grandparent had invested a one-off £1,000 in the average investment trust for a child 18 years ago, it would now be worth £4,600, equivalent to an annualised return of 8.8%. However, if they had made investments of £50 a month instead, their total investment of £10,800 over 18 years would have trebled and now be worth an impressive £33,838. A hefty pot that could help with a deposit on a first home, further education costs or buying a car.
The top performing investment trust sector over the last 18 years is Technology & Technology Innovation, with a total return of £19,493 for every £1,000 invested. This is followed by Biotechnology & Healthcare (£10,287), North America (£6,451), and Asia Pacific Smaller Companies (£6,340).
Nick Britton, Research Director of the Association of Investment Companies (AIC), said: “With ever increasing financial demands on young people, parents and grandparents could consider making an investment to give their child a financial leg up. A modest amount invested now could help with buying a car, a deposit for a first home or university tuition fees.
“Investment trusts are known for delivering strong performance, benefiting from the growth potential of the stock market over long periods. Through a diversified portfolio of investments, they provide a way to spread investment risk. Investing as little as £50 a month into the average investment trust over the past 18 years would have grown to over £33,000. That’s a sizeable contribution to set up a young person for the future. Saving within a Junior ISA is the best way to ensure that any income and capital gains remain tax-free even after your child turns 18.”
Monthly investing in investment trusts
| £50 monthly investment over the past 10 years | £50 monthly investment over the past 18 years | |
|---|---|---|
| Sum invested | £6,000 | £10,800 |
| Average investment trust return | £9,923 | £33,838 |
Lump sum investment in investment trusts
| £1,000 lump sum investment 10 years ago | £1,000 lump sum investment 18 years ago | |
|---|---|---|
| Sum invested | £1,000 | £1,000 |
| Average investment trust return | £2,831 | £4,600 |
Source: theaic.co.uk / Morningstar (to 30/11/25). Average investment trust return excludes VCTs. Amounts rounded to nearest pound.
For more information on saving for children with investment trusts,
read our guide ‘Saving for children’ on theaic.co.uk.
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Notes to editors
- All performance figures exclude VCTs.
- The Association of Investment Companies (AIC) represents a broad range of closed-ended investment companies, incorporating investment trusts and other closed-ended investment companies and VCTs. The AIC’s members believe that the industry is best served if it is united and speaks with one voice. The AIC’s vision is for investment companies to be understood and considered by every investor. The AIC has 286 members and the industry has total assets of approximately £272 billion.
- For more information about the AIC and investment companies, visit the AIC’s website.
- Disclaimer: The information contained in this press release does not constitute investment advice or personal recommendation and it is not an invitation or inducement to engage in investment activity. You should seek independent financial and, if appropriate, legal advice as to the suitability of any investment decision. Past performance is not a guide to future performance. The value of investment company shares, and the income from them, can fall as well as rise. You may not get back the full amount invested and, in some cases, nothing at all.
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