Financial experts recommend opening a Junior SIPP pension account for under-18s, allowing families to contribute up to £2,880 yearly with 20% tax relief, though funds cannot be accessed until age 55
James Rodger Content Editor
18:54, 23 Nov 2025
Pension contributions for those under 18 increased to £79.6m in the year to 5 April 2023(Image: MoMo Productions via Getty Images)
A personal finance expert and financial planner has encouraged parents to open a crucial pension account. According to a financial specialist, parents and grandparents can secure funds for their children and grandchildren’s future with a Junior SIPP.
Rowan Harding, a financial planner at Path Financial, a firm offering financial advice, explained that families can set up a Junior SIPP for those under 18 and begin saving thousands each year towards their retirement.
Data indicates that pension contributions for those under 18 increased to £79.6m in the year to 5 April 2023, up from £75.9m the previous year, according to the most recent figures from the Labour Party government and HMRC.
“It’s a tax-efficient way to build a nest egg for your child or grandchild, and once they are opened by a parent or guardian, absolutely anyone can contribute,” Rowan stated.
Our ChronicleLive Daily newsletter is free. You can sign up to receive it here. It will keep you up to date with all the latest breaking news and top stories from the North East.
“Then, once the child turns 18, control of the pension moves to the child to choose how they want it to be invested, and they can have the freedom to choose options such as green pensions if they want to.”, reports Birmingham Live.
“So you’re not only giving your child a very valuable monetary gift, but also the gift of financial knowledge and the ability to choose where their money goes.”
Children’s pensions enjoy the same benefits as adult versions, with no tax liability on investment income or capital growth within the pension, provided they stay within the Annual Allowance and Lifetime Allowances.
However, while an adult can theoretically invest 100% of their income, a child’s pension has a maximum annual contribution of £2,880 plus an additional 20% tax relief (up to £720).
It’s also crucial to bear in mind that although a child can take control of their pension at 18, unlike a Junior ISA, the funds in an SIPP cannot be accessed until they reach 55 (rising to 57 in 2028).
“This year, parents and grandparents are thinking more about what they are gifting, and the impact gifts can have on their family’s future,” says Rowan.
“A small amount put into a junior SIPP each month until the child turns 18 can really help them further down the line as they reach retirement.”