Thousands of young adults have £1.5k in savings accounts they dont know about

Thousands of young adults have £1.5k in savings accounts they dont know about

07/05/2021

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Thousands of young adults have no idea they have money in their child-trust funds (CTFs).

According to The Times, there is £554million being held in these savings accounts which has been accessible since September.

The average CTF is worth £1,500, but any children whose parents contributed extra many have more available now.

Child Trust Funds are a type of savings account that are used for younger children to save money.

The government automatically opened the accounts for any children born between September 1, 2002, and January 2, 2011.

All of these kids automatically received a £250 voucher, although lower income families would have got £500.

Children born between 2002 and 2010 would have received an additional £250 when they turned seven.

When the accounts were opened, parents could decide whether the cash would be invested in stocks and shares.

Because Child Trust Funds don't let you access the money until you're 18.

But the Investing and Saving Alliance (Tisa) said about 525,000 accounts have matured with 305,000 still unclaimed.

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As the government automatically opened the accounts, the body is worried families have misplaced details or moved house.

Martin Shaw, chief executive of the Association of Financial Mutuals, said: "Letters are sent in the run-up to maturity, but clearly some are lost or thrown away.

"In many respects the message is quite simple: in 99.9% of cases, if you've just turned 18 and haven't yet cashed in your child trust fund, there is a bank or financial institution waiting for you to tell them what you'd like to do."

Nigel Banfield, policy manager at Tisa, said: "Children turning 18 have very little financial footprint, they don't have bank statements, utility statements or the other things that banks would usually require to open an account."

  • Money

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