Put away Your Totally Free Children Trust Fund Voucher with Scottish Friendly, so Your Child Can Have a Large Lump Sum of Money when They Turn 18
6 March 2009Heard about the Child Trust Fund? Not many UK parents surprisingly
modest number of parents appear to have made the discovery that all infants get a free £250 voucher from the the State to place in a Child Trust Fund. The vouchermay be invested in any one of threevarieties of CTF account, Stakeholder – a shares-based account that changesinto cash, a savings account or a shares account. It is a superb chance to invest financial requirements of a young person
Scottish Friendly is an authorised provider of the Child Trust Fund Voucher. The Government is eager for people to have access to Stakeholder accounts and this is the type of account that we are supplying. This means that:
• Investments are saved into Scottish Friendly’s Managed Growth Fund, which aims to provide strong growth potential
• An investment is made in part in shares to get the benefit of potentially higher returns over 18 years,compared to a cash deposit account (although the value of shares canfall as well as go up whereas capital would be protected in a deposit account)
• It comes with a low ‘Stakeholder’ funds charge of just 1.5% per year
• At age 18 the child will get a lump sum, completely free of Capital Gains and Income Tax under prevailing legislation
• It is very affordable – extra payments can be placed in the account from as little as £10
One of the highights of the Child Trust Fund is that anyone – parents, grandparents, aunts and uncles, friends – if they want can add to the Fund to a ceiling of £1,200 per year to help boost the child’s Fund (once added, this money is not allowed to be withdrawn).
What this means is that our Stakeholder account offers a good balance between possible high returns and a lower level of risk. There’s also the additional assurance that our account meets with the Government’s stakeholder criteria. Nevertheless this does not mean that returns are guaranteed or that Stakeholder accounts are suitable for everyone. Remember that the value of shares in the Managed Growth Fund (where your Child Trust Fund money is invested) can fall as well as go up and isn’t guaranteed.
Only children born on or after 1st September 2002 are qualified to start up a Child Trust Fund. If you have above-mentioned date who are not allowed you could think about investing for them with a Child Bond – it’s a tax-free savings plan aiming for long-term growth. It is evident that investing for your children is a sensible means of preparing for the world to come.
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