Child Trust Fund contributions on the rise
Regular and lump sum contribution levels into Child Trust Funds (CTFs) are continuing to increase in value, according to The Tax Incentivised Savings Association (TISA).
In the sixth TISA survey, average monthly CTF subscriptions rose to £21.86 per month (up from £21.20 for the same period in 2007), while the average lump sum subscription increased by £84 on last year to £488.
The survey covers the second quarter of the year to 15 June 2008 and provides an insight into more than 2.25 million accounts opened by participating providers. During this quarter 112,335 new accounts were opened and the number of accounts with active monthly direct debit subscriptions rose by 27,198.
Tony Vine-Lott, TISA director general, said: “Bearing in mind the financial squeeze that is affecting so many families at the moment, the continuing increase in the level of regular savings into a CTF is particularly encouraging. However while the number of CTFs with a direct debit subscription now exceeds half a million, the majority of accounts still do not receive any form of top-up.
“I would like to encourage more parents to commit to saving a regular amount into a CTF, obviously at whatever level they can best afford. It’s vitally important that children see the tangible benefits of saving at an early age. It is less how much is saved, more that something is saved, that will teach them a lifelong lesson on how to manage their finances more effectively.”