Child trust funds
UK Child Trust Funds are a Government incentive which have been designed to enable children to have their own Financial Assets when they reach adult age.
Eligible children are those who are a UK Resident and who were born after 1st September 2002. If your child meets this criteria then you should be eligible for a £250 Voucher with which to open an account. An extra £250 credit may be made if your household receives Full Child Tax Credits and the household income is at, or below the Child Tax Credit income threshold. If this is still the case when your child reaches age 7 then an additional £250 credit may be paid into to your Child's Trust Fund.
Finding the Best Child Trust Funds
There are a number of Savings Accounts and Children's Bank Accounts to choose from when looking where to place your children's Child Trust Fund Vouchers. But, if you choose to invest with National Savings and Investments they are providing a guarantee that all of your money will be 100% safe no matter how much you invest. This is due to National Savings and Investments being backed by HM Treasury, which in the current climate is great promise to be able to make.
There are also investment companies who can place your investments such as in the USA Fidelity Investments, in Dubai Zabeel Investments and in the UK Standard Life Investments to name just a few.
Who Can Open a Child Trust Fund
The Child Trust Fund Vouchers are sent to the people who receive Child Benefits though this does not mean that is has to be that person who sets up the Child Trust Fund. The person who opens the Fund does have to be one of the child's Parents or have Parental Responsibilities. This means that they would need to be a Step Parent, Guardian or Adoptive Parent. The responsibility remains theirs until the child reaches their 16th birthday unless responsibility is changed to another legally responsible person. In this event the Bank or Building Society which holds the Trust Fund must be notified as they will need to update their Registered Contact.
Forgot to Open an Trust Fund Account?
Child Trust Vouchers do have an Expiry Date and so a Fund must have been opened prior to expiry, or up to a maximum of 7 days after. If the voucher is not used within this time then HM Revenue and Customs will open a Stakeholder Account for your child. They will then write to notify the person who receives child benefits that this is what they have done and also advise where the stakeholder account is held, giving them the option to contact the provider and become the Registered Contact.