The Building Societies Association has released figures revealing that most parents are opting for the cash Child Trust Fund (CTF) account over a stakeholder account.
Of the 50,000 CTF accounts opened in June, 31,000 were cash accounts. Since the CTF option became available 70 per cent of people have chosen the cash option.
Reasons for the preference remain unclear, but a possibility is that the cash option is less risky.
Brian Morris, head of savings policy at the BSA commented: "Evidence suggests that many parents have still not decided where to put their child's voucher. We believe they should have the option between cash and equity, and most are choosing cash."
Net receipts into cash CTF accounts reached £12 million for June, putting the total amount placed into cash accounts at £51 million.
So far it is believed that the balance of most accounts does not go much farther than the £250 starting voucher provided by the government. To read more about child savings, click here.
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