Good year for child trust funds in 2007
The Children’s Mutual has today welcomed the figures from HM Revenue & Customs (HMRC) showing that 3.23 million children now have a Child Trust Fund (CTF).
According Children’s Mutual, a UK-based specialist in long-term savings for children, 2007 marked the year when the face of savings changed for a whole generation.
Figures from the organization show that the average monthly amount being saved by direct debit is £23.41, up by nearly 4%– if this contribution remains unchanged until the child reaches 18, they could receive a lump sum of £9,500 when the CTF matures.
David White, chief executive of The Children’s Mutual, said: “The CTF is set to change the lives of a whole generation. Before the CTF was introduced, just one-in five-families was saving regularly for their children; this has now leapt dramatically and in 2007 almost half of new CTF accounts placed with us received monthly top-ups from the outset.”
White added: “By saving regularly over the long term, families can help their children to start out in adult life with a lump sum to help towards the cost of the future. And with careful planning and saving they could also avoid the nightmare being faced by parents of today’s 18 year olds who often have to raid their savings and retirement funds to give their children a financial headstart.”
CTFs are a savings and investment account for children, which enable children born on or after 1 September 2002 to receive a £250 voucher to start their account. The account belongs to the child and can’t be touched until they turn 18.