Contributions to Child Trust Funds increased in the third quarter of 2009, despite households suffering from ongoing financial difficulties.
According to the latest quarterly survey from TISA (Tax Incentivised Savings Association), 30,000 additional Child Trust Funds received monthly payments by direct debit compared to the second quarter.
More than 640,000 Child Trust Funds, 21.5 per cent, now receive a regular monthly contribution – worth more than £14.4million – which marks an increase of more than £800,000 on the previous three months.
Of all CTFs surveyed, which represent 65 per cent of the Child Trust Fund market, 30.8 per cent received additional deposits, up from 30.2 per cent in the previous quarter, either in the form of a direct debit or a one off lump sum.
The figures show that around 1.4 million parents, grandparents or other friends and relatives are depositing more than £22million each month, with the average monthly contribution increasing marginally, up to £22.59 from £22.38 in the previous quarter.
Commenting on the latest statistics, Tony Vine-Lott, director general of TISA, said: "Despite the challenging economic situation it is encouraging that contributions to CTFs are continuing to rise. Understandably, the increases are currently at a modest level, but it does confirm that parents see the value in providing their children with a financial nest egg when they reach 18.
"The introduction of the second CTF payment in September for those reaching their 7th birthday will also stimulate further interest. I hope that families will use this as an opportunity to reinforce the message about money awareness as part of the broader efforts to improve the financial literacy of young people."
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