Market crashes terrify parents. When your child's Junior ISA drops 15% in red, every instinct screams "sell!" But here's what the data actually shows: Junior ISAs with £9,000 annual allowances are built to thrive during volatility—if you understand why.
Market Crashes: What Actually Happens
- The reality: Sharp drops, scary headlines, friends panicking on social media.
- The history: Markets have always recovered. Every single time. The S&P 500, FTSE 100, and global indices hit new highs after every crash—eventually.
- The trap: Panic sellers lock in losses. Long-term holders win.
Why Junior ISAs Are Built for Volatility
Junior ISAs have three crash-survival advantages:
Time Horizon (To Age 18)
If your child is 10, you have 8 years before they access funds. Most crashes recover in 18-36 months.
Monthly Contributions (£9,000/Year Max)
Regular investing during crashes means buying more shares when prices are low. This is called pound-cost averaging—it's your secret weapon.
Dips = Cheaper Units
The same £100 buys more fund units at £5/share than £8/share. Red months are discount months.
Uncomfortable short-term. Powerful long-term.
The Real Risks Nobody Talks About
Junior ISAs don't fail from market crashes. They fail from:
Selling during dips
Locking in losses instead of waiting for recovery
Pausing contributions
Missing discount opportunities when prices are lowest
Switching to cash
Inflation erodes 2-3% annually—guaranteed loss
We didn't pause our contributions during our worst month. We explained exactly why—and watched the recovery.
The Data: Recovery Track Record
| Crash | Recovery Time |
|---|---|
| 2008 Financial Crisis | 5 years (by 2013) |
| 2020 COVID Crash | 8 months (Nov 2020) |
| 2022 Bear Market | Recovery underway 2024-2025 |
Junior ISAs for young teens have 3-8+ years. History favors holders.
Should You Stop Contributing?
Short answer: No.
Long answer: If you genuinely need the money for emergencies, pause temporarily. Otherwise, red months are buying opportunities your future self will thank you for.
Markets reward discipline, not timing.
The Bottom Line
Junior ISAs survive crashes through time + discipline. The £9,000 annual allowance lets you compound through volatility—but only if you stay invested. Crashes test nerves, not strategy. Your JISA's job is growth to 18, not comfort today.
Disclaimer: I am 15. This is NOT financial advice. I am learning in public. Do your own research before doing anything with your money.