Laying the foundations for a rent-free life

November 25, 2021

Our generation is more used to renting than ever. Many of us don't even think of a possible alternative in our early 20s.

According to the Office for National Statistics 'the number of households in the private rented sector in the UK increased from 2.8 million in 2007 to 4.5 million in 2017, an increase of 1.7 million (63%) households'.

Today, 20% of the UK population is renting. The expectation for 2021 puts that figure at 25%. By 2025, PwC project that almost 60% of 20-39 year olds in London will be renting (both private and social sector).

The numbers don't look great but setting up the right fund for your children could mean they don't contribute to those statistics and instead have the opportunity to step up on that narrowing property ladder easier.

As a (very) long-term goal, saving up for their first home down-payment means you can take full advantage of the investment products available in today's market.

Junior stocks & shares ISA

  • £9k annual limit on investment for 2020-2021 tax year
  • exempt from income, dividend and capital gains tax
  • contributions from non parents allowed and untaxed

Personal stocks & shares ISA

  • £20k annual limit on investment
  • exempt from income, dividend and capital gains tax
  • self-discipline needed to avoid withdrawing money for personal use

Personal general investment account (GIA)

  • no annual limit
  • capital gains tax annual allowance set at  £12.3k for the tax year 2020-2021
  • any profit over £12.3k is taxed
  • self-discipline needed to avoid withdrawing money for personal use

A bare trust

  • a junior investment account within a bare trust
  • no annual limit
  • places the funds in the child’s name meaning you can’t use them for your own benefit
  • uses the child’s CGT allowance — decreasing the chances of you having to pay tax.
  • any contributions from non parents (e.g. grandparents, godparents, aunts & uncles, etc.) are also exempt from income tax.

Do you want to stay on top of parenthood finance? Join our community and we'll keep you up to date! If you'd like to speak to us about how Nosso could help you save, drop us a line at


All writers' opinions are their own and should not be read as personal financial advice.  Individual investors should make their own decisions or seek independent advice. As with any investment, your capital is at risk and may be going up as well as down which means you may be left with less than your initial investment. Past performance is not a reliable indicator of future performance. Please note that tax treatment depends on the individual circumstances or each client and may be subject to changes in the future.