The government has announced a new initiative to contact hundreds of thousands of young people across the UK who may have forgotten savings accounts worth an average of £2,200 each. These accounts, known as Child Trust Funds (CTFs), are long-term, tax-free savings vehicles set up for children born between 1 September 2002 and 2 January 2011. Official figures reveal that more than 750,000 of these accounts remain unclaimed.
Government Awareness Campaign
HM Revenue and Customs (HMRC) will begin contacting 21-year-olds whose CTFs have not yet been claimed, informing them of their entitlement. This effort is part of a broader government awareness campaign urging young individuals to locate their funds using the free "find my child trust fund" service available on gov.uk. When the account holder turns 18, the account matures, allowing them to withdraw the accumulated money or reinvest it.
It is important to understand that these savings are not held directly by the government but are managed by banks, building societies, or other designated savings providers. Many children initially received around £250 from the government when their CTF was opened, and those from low-income families or in local authority care may have received an additional £250.
How to Access Your Funds
If young people or their parents or guardians already know who their CTF provider is, they can contact the provider directly. For those unsure, the government's online service can help locate the account.
Economic Secretary to the Treasury Lucy Rigby convened a roundtable earlier this week with CTF providers to discuss how the sector can improve efforts to reconnect savers with their accounts. Ms Rigby stated: "Hundreds of thousands of young people in this country don’t know they have a CTF, let alone how to access it. Some will have a couple of thousand pounds sat there that would really help them as they begin adult life. I’m determined that those who have CTFs are made aware they have this money. Together, we will ensure funds from these child trust funds can be accessed by young people to help give them the best start to adult life."
Child trust funds have now been replaced by junior individual savings accounts (ISAs), which are similar long-term, tax-free savings accounts for children. However, unlike CTFs, the government does not contribute any money when junior ISAs are set up.
