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Halifax reveals kids lose out as parents get lazy about Child Trust Funds

01 June 2005
At least one million children in the UK are losing out as their parents fail to invest the money granted them through the Child Trust Fund (CTF) scheme.

According to Halifax Financial Services, at least half the two million children eligible for the CTF scheme who have received vouchers worth at least £250 over the past few months are losing out because their parents have not yet opened a CTF account.

Halifax Financial Services estimates that the laziness of their parents is costing the children a collective £1.8 million a month (based on a £250 voucher growing at seven per cent per year in a Stakeholder CTF).

"Almost £250 million in Child Trust Fund vouchers could be lying around in people's homes waiting to be invested. It is a long term investment but parents need to take immediate action to reap the rewards," commented Ray Milne, managing director of Halifax Financial Services.

"If parents delay the opening of their CTF account by up to 12 months the Government will open the CTF account with one of the registered default account providers. This will mean that the account will receive no interest in the first year."

A survey by CTF provider Family Investments painted an even more dismal picture last week, suggesting that almost three-quarters (72 per cent) of parents had failed to invest the voucher.

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