Save, make, understand money


Millions of teens to take control of their Child Trust Funds

Paloma Kubiak
Written By:
Paloma Kubiak

From 1 September, those reaching 16-years of age will be able to take control of their Child Trust Funds, worth a combined £9.3bn. Here’s what you need to know.

Child Trust Funds (CTFs) were available for children born between 1 September 2002 and 2 January 2011 as a way to save for their future.

The government funded the CTFs with two lots of £250 vouchers, or £500 vouchers for families in receipt of Child Tax Credit.

In total, around 6.1 million CTFs were set up and given the government funding, contributions from family and with growth over the years, they’re estimated to be worth £9.3bn.

While teenagers already own these accounts, the oldest – who are turning 16 from the 1 September – will be legally allowed to take control of them. But it will be another couple of years until they can actually get their hands on the funds.

But one of the major hurdles facing teens in their quest for control is that an estimated one million CTF accounts are lost, labelled as ‘addressee gone away’. According to The Share Foundation, The Share Centre’s charity, and the Tax-Incentivised Saving Association (TISA), around £1bn is missing.

They said one of the main reasons is because accounts were opened by HM Revenue & Customs on behalf of children as parents/guardians had not done so within the first year of birth. For those families in receipt of Child Tax Credit at the time, virtually all accounts were opened by HMRC.

As many as 1.74 million accounts were opened in this way.

How to track down a Child Trust Fund

Visit the Shares4Schools Find a Child Trust Fund website. From this page, you will be able to request information about the account from HM Revenue & Customs.

You’ll need to be a parent, guardian or the actual young person whose name the account is in. You’ll need a government gateway ID and once you’ve submitted the form, you should receive a response within 15 days, telling you the provider details.

Once you have this, you’ll need to contact the provider directly to update the registered contact details.

Chairman of The Share Foundation, Gavin Oldham, said CTFs provide teenagers with one of the biggest opportunities and challenges in the field of personal finance today.

For teens who want to be active in their role, they should get a recent valuation. They can then think about cash earning interest as an alternative to investment if they wish to access their money at 18.

Oldham said: “The Child Trust Fund was the centrepiece of Gordon Brown’s plan to encourage asset-based welfare. His objective was to establish a savings habit among children, providing a cushion of financial assets as they embark on adult life and enabling them to be confident in the management of their finances.

“After a decade of relative neglect, the years ahead are vital for achieving the original purpose of the Child Trust Fund, which affects so many young people across the United Kingdom. I am determined to ensure that, working with my colleagues in The Share Centre and The Share Foundation and beyond, the scheme does indeed make a significant contribution to breaking the cycle of deprivation in the United Kingdom, and to helping all young people to develop their potential in adult life.”