How should I invest for my children?

Q I am a housewife with two children (aged eight and four). My husband earns ?20,000. We own a house with no mortgage on it. I have an internet account with ?6,000 and an Isa investment trust (I initially invested ?5,000 in the Isa; it's probably now worth about ?l,500).

My husband has ?3,000 in a mini cash Isa. The children have ?2,500 each in their own accounts with the Nationwide. My question is, what is a long-term and low risk form of investment for my children?

CM

A Long-term investment for me still suggests investing in shares, in spite of (or perhaps because) of the recent falls in share markets.

I appreciate that you are probably far from happy with your investment trust Isa at present.

A compromise would be to consider keeping your children's money on deposit - Nationwide's children accounts are pretty competitive at present - but withdrawing say ?50 a month to invest in a monthly savings investment trust scheme.

Making regular payments reduces risk considerably, as you benefit from buying more shares when prices are low, and the charges are minimal. It is by far the cheapest way to invest in shares, with reduced risk.

You can designate the holdings in your childrens' name to revert to them when reaching age l8.