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You and your money
When a child is born there's always lots to see to. Even so, it's never too soon to plan for the child's future and put in place the building blocks that will lead to financial security and an adult life free from money worries.
With this in mind the Government introduced the Child Trust Fund (CTF), a long-term savings account which allows your child (and no one else) to access a pot of money once they turn 18.
The Government gives a £250 voucher to start each child's account, and adds another £250 when they reach 7. Children in lower income families get extra. Simply take the voucher to any CTF provider to open the account.
Important features of CTF accounts are:
- Parents, family and friends can add up to £1,200 a year to the fund.
- Money can't be taken out, but the child can start to make decisions about how to use their money when they are 16.
- You can switch to another provider at any time.
- No tax is payable on any gains made, and it won't affect your benefits.
Why not pop into your local library and log on to www.childtrustfund.gov.uk for helpful tips on picking a CTF? Check out the different providers and shop around for one that suits your child. Consider what fees are charged, what the likely returns may be, how convenient it is to pay in, and (if this matters to you) whether the fund is invested ethically.
These days you shouldn't leave your child's future to chance, so don't leave your voucher in a drawer, get it working for your child as soon as possible.
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