Deciding where to invest can be a tricky decision – and one that will change over time – as we get older and our priorities and financial goals change.

Here, we take a look at how different generations could take advantage of different tax-efficient investment wrappers, and some funds you may like to consider.

Generation Alpha: children under 10 years of age

The youngest generation – Generation Alpha – are children born between 2010 and 2024. At the moment that means newborns to 10-year-olds.

The obvious tax-wrapper choice for this age group is the Junior ISA. Parents, grandparents and family friends can invest up to £4,368 a year via the wrapper and the proceeds will be free from dividend, income and capital gains tax. When the child reaches 18, it becomes their money to either spend or continue to invest.

A junior pension is another option – just remember your child will not be able to access this money until they are at least 57 years of age. However, over that time period, even a small investment could be worth a great deal. You can pay £2,880 a year into a junior pension and that will be topped up to £3,600 by the government in tax relief. While free from capital gains tax the eventual pot of money will be subject to income tax when it is withdrawn in retirement.

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Two funds to consider:

Hermes Global Emerging Markets SMID Equity is a fund that invests in small and medium-sized companies across global emerging markets. Smaller companies and emerging markets tend to be higher risk than larger companies or developed markets, so this fund is top of the risk scale. But there is huge potential to tap into exciting growth stories over the long-term.

Investec Global Environment invests in companies that are contributing to the decarbonisation of the global economy. The portfolio invests in just 20-40 companies that are doing their best to protect the planet and our children’s futures.

Generation Z: 11 to 23-year-olds

The youngest of Generation Z could also have a Junior ISA or pension wrapper, while older Gen Zs could consider an adult ISA and should hopefully be contributing to a workplace pension.

ISAs are a useful way for adults to invest up to £20,000 each tax year and keep the tax man at bay. There is also the Lifetime ISA, which allows adults under the age of 40 to invest up to £4,000 a year and get a 25% government bonus. You can open one between the ages of 18 and 39 but also keep contributing until you reach 50. The only catch is that this money can only be used to buy a first home, or for retirement when you reach 60. For anything else, there’s a 25% penalty on the whole amount.

Employers are now obligated to provide a pension for employees. So, for older Generation Zs this is a no-brainer – it’s free money to invest.

Two funds to consider:

AXA Framlington Global Technology is a great fund for engaging older children with their investments as it invests in things even they use and understand, like Apple and Facebook.

Lazard Global Equity Franchise might appeal to older Gen Zs. It invests in companies from all around the world that have an edge in their respective sectors.

Millennials: 24 to 39-year-olds

A big financial goal for this age group is often to buy their own home. So the Lifetime ISA mentioned earlier is an option, or the adult ISA for those with more than £4,000 available to invest each year.

Some millennials may also have a young family and extra outgoings to consider, so spare cash may not be plentiful. So a good habit may be to make monthly savings at this stage of life: just like monthly bills, you can set up an ISA to take a small (or large) monthly amount from your bank account.

All millennials should at least have their workplace pension working for them at this point – and ideally be contributing a small amount monthly themselves too.

Two funds to consider:

Schroder US Mid Cap has a focus on small and medium-sized companies in the world’s largest economy.

Invesco Asian invests in companies across the continent and also Australasia.

Generation X: 40 to 55-year-olds

People in this age group are likely to be at ‘peak earnings’ – the stage of their careers when their salary is highest, and hopefully financial demands are starting to lessen.

It makes sense for Generation X to invest as much as possible into an adult ISA and their pension while they can – especially higher taxpayers who can currently get extra tax relief on their pension contributions.

Two funds to consider:

With some time left until retirement – and hopefully a good couple of decades to enjoy in retirement – the time horizon for Generation X is still pretty long, so it’s worth investing in equities still. Artemis Global Income invests in companies around the world, with a bias towards those of medium size and with a modest but growing dividend payment.

GAM UK Equity Income stays closer to home, investing in UK companies of all sizes.

Baby boomers: 56 to 74-year-olds

ISAs still have a valuable role to play once you’ve reached retirement age – or an age when you can access your pension pot if you want to.

Younger baby boomers, with a decade or so until they actually retire, could still invest in equities, although a mix of assets or dialling down the risk may give more comfort.

Older baby boomers could also consider cash at this stage to make sure they preserve the capital they have worked so hard to accumulate.

Either way, all baby boomers can now take advantage of the 25% tax-free lump sum they can withdraw under pension freedoms rules. This money could be spent to pay off a mortgage or on something nice. It could also be reinvested into an ISA – either cash, or stocks and shares.

It’s also worth remembering there is an attractive inheritance element to ISAs: married couples and civil partners can inherit each other’s ISA allowance and benefit from the tax-free interest if one dies.

Two funds to consider:

Bonds are generally considered to be less risky than equities. M&G Corporate Bond invests mainly in sterling-denominated investment grade bonds – the debt of companies that are deemed to be of a high quality and less likely to default on their repayments.

Jupiter Distribution invests in a mix of equities and bonds. The mix is usually 30: 70. While exercising caution and diversification, this fund has a record of consistently outperforming its peers and is a strong contender for cautious investors.

Darius McDermott is managing director of FundCalibre