Saving and investing
A. Saving
If you want your child to have access to the money within a few years, it’s usually smarter to save. If you intend to set aside money for your child from the moment they’re born, you probably don’t need access to this money until your child is 18. In that case, you have time on your side and are better off investing. That’s because investing has the potential to earn higher returns over the long term than saving.
B. Investing
Investing has the potential to earn higher returns over the long term than saving. And the earlier you begin investing, the better. If you don’t need the money for a while, say at least five years, investing could be an option.
If you want to give the money to your child sooner and still invest, you’ll need to find a solution that works in your specific circumstances. Ask an adviser for help.