You are here: Home - Investing - Experienced Investor - News -

Huge leap in teen awareness of Child Trust Funds

0
Written by:
14/09/2021
Awareness of Child Trust Fund pay-outs among teenagers has soared in the last year, according to research.

Nearly three in five (59 per cent) 16–17-year-olds know about CTF pay-outs, compared to just 38 per cent a year ago, a survey by Orbis Investments found.

CTFs were a government scheme available to all children born between 1 September 2002 and 2 January 2011.

Under the scheme, parents or guardians were given vouchers to set up accounts with Child Trust Fund providers, which were usually banks, building societies or investment managers.

If an account was not opened by the child’s parent, HMRC set one up on the child’s behalf.

When they turn 18, recipients can take a cash lump sum or roll the money it into a traditional stocks and shares or cash ISA. So, last September was the first month teenagers could access their cash.

However, awareness of CTFs has been low in recent years, with hundreds of thousands of teenagers missing out on an average windfall of £1,500 each because they either haven’t claimed their cash or don’t know they have an account.

But in a reversal of last year’s findings, awareness has shot up.

The research shows that of the 16- and 17-year-olds waiting to receive the money on their 18th birthday, 36 per cent were still unsure of what to do with it.

Nearly a third (28 per cent) said that they planned to save the cash, but not in an ISA, while 17 per cent said that they would continue to save in an ISA. Less than 13 per cent were looking to spend it.

Dan Brocklebank, head of Orbis Investments UK, said: “While it is encouraging that awareness of CTF entitlement seems to have risen over the last year, there is still a long way to go – 41 per cent are still unaware of the lump sum amount they will receive.”

Parents or children can track down lost Child Trust Fund amounts at this link: https://www.gov.uk/child-trust-funds/find-a-child-trust-fund

 

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Flight cancelled or delayed? Your rights explained

With no sign of the problems in UK aviation easing over the peak summer period, many will worry whether holida...

Rail strikes: Your travel and refund rights

Thousands of railway workers will strike across three days this week, grinding much of the transport system to...

How your monthly bills could rise as the base rate reaches 1.25%

The Bank of England has raised the base rate to 1.25% as predicted – the fifth consecutive rise in just six ...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week