‘Our kids love McDonald's, so we invested their Isas in it'

Telegraph

25-03-2025

Most young children fritter their pocket money away on toys and sweets, but Ivan Vera Marun's kids invest theirs in the stock market.
The 44-year old university lecturer from Manchester has created 'mini' portfolios within his own Isa where he allows his three children – aged two, eight and 13 – to experiment with investments.
The sub-portfolios hold about £500 each, and he saves into them every month or two. The children's picks so far include the iShares Physical Gold ETC – a proxy for investing in gold – and McDonalds.
He says: 'Their asset preference is certainly biased towards shares. We occasionally invest in companies they are interested in. For example, they like to eat at McDonalds – so we use a platform to look at how the individual companies behave over time and to really appreciate that investing in shares can be a rocky ride.
'The main message is to show them that you can have something that looks risky and has a lot of ups and downs but in the long term there can be bigger rewards.'
It has not always been smooth sailing. At first, his children were not the most disciplined investors.
'One of their initial issues was resisting the impulse to get money out and spend it any time they could see a win. The other has been trying not to put everything into the one company they like or that has performed the best.'
But they're definitely learning, he says.
'What I'm trying to instil in them is the importance of diversification, for example through bonds, versus just going all in on the company that makes their favourite things.
'By now, they at least appreciate that it is a good idea to combine different types of assets – so that's what the Junior Isa is for.'
In addition to the sub-portfolios, Vera Marun runs Junior Isas for each child, invested in exchange-traded funds (ETF) like the iShares S&P 500 Information Technology Sector and VanEck Crypto and Blockchain Innovators .
He tinkers with these holdings very little, so the children will each have a nest egg by the time they are 18 years old.
Since the Junior Isa was introduced in 2011, it has become a popular way for parents to set their children up for the future. Around 1.25 million accounts were opened in 2022-23, according to the latest figures from HM Revenue and Customs.
You can save up to £9,000 a year into a Junior Isa for any child under the age of 18 and living in the UK. By consistently maxing out the annual allowance, parents could potentially help their children amass six-figure fortunes.
Last year, figures obtained in a Freedom of Information request by the wealth manager RBC Brewin Dolphin revealed that the 50 biggest Junior Isas contained £761,000 on average.
But for Mr Vera Marun, setting up investments on behalf of his children is not just about giving them a valuable nest egg. It's also about giving them an early financial education.
'My wife and I are originally from Venezuela, and we had this hard experience of seeing how socioeconomic instabilities can lead to hyperinflation – and how a whole generation can see their hard work dissipate because of mismanagement.
'So after we arrived in the UK and learned about the investing vehicles available to everyone in Britain – particularly Isas – we had a very strong realisation that this wrapper, this tool, is something really precious that's not available to many countries in the world.
'And I started to become aware there is a huge deficiency in terms of financial education, particularly personal finance education, not just in the UK but the whole world.
'For the whole population there is a need for a strong financial foundation particularly when people are in their young years. So I decided to take action with my kids.'
Make children engaged with investments
Mr Vera Marun is trying to teach his children financial skills he hopes they will take with them through life. More recently, he's been simulating what it would be like for them to earn a salary and pay into a pension.
'Something that we've been doing in the last year is setting them tasks – for example, cleaning – and they do that every week or every two weeks, and whenever they do these tasks, I give them a couple of pounds.
'Then I ask them, 'What do you want to do? Do you want to put the money in your investment account?' At the beginning, they were more often opting to save it in cash. They wanted to see the money there and eventually spend it on whatever they wanted.
'Whereas now, as they have become more aware of how investments work, they try and do it half and half. They say, 'Give me one pound and put one pound in my investments'.'
He adds: 'By the time they become young adults, I'm just hoping they can be that person that starts to be a bit conscious about their savings and investments and doesn't opt out of a pension plan with an employer because they want more money for holidays.'
Sarah Coles, of stockbroker Hargreaves Lansdown, says there are a number of ways parents can make their children more engaged with investments. One way is to follow shares they like.
'One of the easiest ways to show them this is to take a company they're interested in – like a media company or snack food – and follow its performance regularly.
'You can do this on an ad hoc basis, or put them into a watch list on an investment company app, which will track their individual and overall performance. You can then check in every week and see how their portfolio is faring.'
Another is to give them some agency.
'It can be difficult to let them make mistakes, but as long as it's on a relatively small scale, there's room for them to take the lead on some investments and make their own choices.
'It not only hooks their attention, but it gives them experience of what it feels like to be an investor and make reasoned choices with real-world consequences.'
She continues: 'There will be some periods of underperformance and some times when the market struggles. If you can show your child that this is all part and parcel of investing, they won't be too afraid of risk in order to benefit from the long-term potential of investing.'