Child Trust Funds could ease financial burden for students
21 August 2009 / by Andy Davies
As the cost of university rises to £25billion, opening a Child Trust Fund could help ease the financial burden felt by many students.
According to The Children’s Mutual, this represents a £ 3 billion increase on last year, with the average student incurring costs of £42,000 to fund a three-year course.
Many students this summer are also finding it increasingly challenging to get summer jobs to help fund their course because of the recession.
The Child Trust Fund provider found that 87 per cent of young people are receiving financial help from their parents and are now urging families of young children to start planning for their child’s future early.
The Children’s Mutual believes parents can help mitigate these rising costs by saving for their children from an early age.
David White, chief executive of The Children’s Mutual, says that funding university costs can be very difficult for parents.
He said: “While parents will be pleased about their children’s successes as they receive their A-level results and many look forward to university, the high costs involved can be a real financial strain to many students and their parents.”
Launched in 2002 by the government, a CTF provides tax-free returns on savings and deposits can be made by parents, family and friends.
Mr White believes the Children’s Mutual Child Trust Fund can help prevent parents dipping into their savings or remortgaging their house to pay for university costs.
He added: “From 2020 all 18 year-olds will have access to their maturing Child Trust Funds as they enter adulthood, and the money saved in these paid into a student bank account could make a real difference to both future university students and their parents.
“Those who save £24 per month, the average amount amongst The Children’s Mutual customers, could have a fund worth £9,750 when they reach age 18.”
© Fair Investment Company Ltd