Don't let your child lose out on their Trust Fund

30th January 2007

The Child Trust fund has been going now for almost two years – during this time every child born after 1st September 2002 has been eligible to have £250 placed in an account that is  designed just for them  to use when they reach eighteen.    It is tax payers money, of course, but its free money to each child.  The  problem is: some children won’t get their free money because, even though they have the vouchers, some parents aren’t opening the accounts that  make it all possible.

Last week was ‘Child Trust week’ and during the week, I took the trouble to find out  what’s happening in Southampton. From the figures, almost one in three eligible children in the city don’t have accounts, and their nest eggs remain unclaimed. 

Why open a Child Trust Fund? As a keen supporter of the Child Trust Fund initiative right from the start, I believe that every child deserves the best start in life, be it in education, health or from local community services, and this fund forms part of this package by giving parents a head start in saving for their child’s future.

When you open your child’s account they will receive an initial £250, and for parents on low incomes there’s an extra £250 allowance. There’s also a guaranteed top up when your child reaches 7 years old. However, your child’s Trust Fund is not just about the initial contribution but also about creating the opportunity and incentive for you and your child to save for their future as they grow up. In addition to the Government contributions, parents relatives and friends can ‘top up’ the fund by up to £1200 per year The Child Trust Fund website offers some examples of how you can teach your child about saving, whether it be the money they get from the tooth fairy or birthday money, so that they can watch their savings grow.

While the initial contribution of £250 may not seem like a lot of money, it is a base that with your own contributions and the government’s top –up, could soon grow with interest into an amount that could really help your child when they’re setting out on their own - be it help towards going to university, starting a business or putting a deposit down on a house.

I am sure that there are parents in Southampton who will want to take full advantage of this money and open their Child Trust Fund. For more information visit http://www.childtrustfund.gov.uk/ or call 0845 302 1470 and start saving!

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