Barclays says parents don't trust funds

According to Barclays Bank parents remain sceptical about the new Child Trust Fund initiative.

All babies born after September 2002 which qualify for Child Benefit are due to be mailed a voucher for between £250 and £500 by the government, which can be invested in a Child Trust Fund for the baby.

This money can be topped up by relatives and friends of the child, who will be able to access the fund when they turn 18.

But an offer of free money has been seen as too good to be true by many parents, even if they feel a sound financial base for a child is a good idea.

"Despite a degree of scepticism revealed in the research, people felt a Child Trust Fund would help a young person get a start in life and that it might encourage parents to save for their children," said Paul Morrish, Barclays' director of personal customers.

Additionally parents prefer traditional savings for their children, and few said they would contribute the full amount to the funds.

"None of the parents expected to contribute the maximum £1,200 a year to the fund," Barclays' survey noted.

To find out more about investing for children's future, click here.
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