Child NISA and Lifetime Gifting are a Perfect Match

Many parents worry about
"what form they should leave their assets in"
for their children's future.

As a banker and as a father myself,
I have faced this theme every day.

Let me state my conclusion.

In the coming era, for asset transfer from parent to child,
"steady lifetime gifting" using the Child NISA
is truly a perfect strategy.

The idea of turning investment into "gifting"

In my home, my two children are currently in the upper grades of elementary school.

Regarding their education funds, I have already secured a certain outlook
by liquidating investment trusts in my own name.

Therefore, for the Child NISA quota starting next year,
I intend to use it not just as a savings plan for education,
but as a "means of lifetime gifting"
from me to my children.

Inheritance measures that move a large sum of money at once
might be a method for the wealthy.

However, what is important for us parents in our 40s
is the "process itself" of transferring assets
little by little over time.

The "100,000 yen" investment experience started with my children

Looking ahead to the use of this system, this year I gave my children
100,000 yen each,
and decided to leave the investment to them.

"I want them to know what it means to invest money."

Perhaps my explanation was too enthusiastic,
but the portfolio the children finally chose
turned out to be quite sharp (lol).

• FANG+: 50,000 yen

• Global Stocks: 30,000 yen

• Domestic Stocks: 20,000 yen

It was an elementary schooler-like (and slightly bold) choice to place heavy weight on FANG+,
but seeing the two of them seriously discuss

"Which one is good?"
and "Doesn't this one look like it will go up?"
I decided to approve that policy.

As a result, this 100,000 yen currently has an
unrealized gain of about 10,000 yen.

More than the original goal of "asset transfer",
the fact that the children became interested in the price movements of their own investment trusts
and started taking an interest in various news,
saying "It went up today" or "It went down"

I feel that this change is the greatest harvest of all.

Why is "steady, step-by-step" the strongest approach?

I believe this method has three major benefits.

1. You can gift the greatest asset: time.
Starting investments in their own name from a young age is not just about giving them money.

It is the same as gifting them the "art of making time your ally" through the power of compound interest.

Having assets that have been invested tax-free by the time they reach adulthood will surely be a powerful weapon for their lives.

2. You can minimize the tax burden.
By steadily transferring ownership within the 1.1 million yen annual limit, you can systematically, albeit gradually, reduce the taxable amount for inheritance tax.

Instead of a lump sum, you can build a track record of "continuous annual gifting" through NISA.

3. It comes with "financial education" as a set.
More valuable than the investment performance is the time spent between parent and child discussing investing.

"How does money grow?" and "Why does this company grow?"

The financial literacy cultivated through these dialogues will become the most reliable asset for them when they enter society in the future.

Money is a ticket to enrich one's life.

I have a desire not to let my children struggle with money.

However, that does not simply mean increasing cash and handing it over to them.

What is truly important is to pass on the money literacy and the wisdom of how to handle money that I have acquired through investing from parent to child.

The lifetime gifting I am planning through Junior NISA is not just a technique for tax savings or asset transfer.

It is a tool for the family to think about "how to use money" and to learn together.

Rather than just hoarding the money grown through asset management, we should use it properly for family trips and irreplaceable experiences.

I hope they become adults who can use money as a "ticket to live a rich life" in that way.