Young people urged to claim their savings

Many young adults in Denbighshire could have an average of £2,000 waiting for them in their unclaimed Child Trust Fund account.

Child Trust Funds are long-term, tax-free savings accounts which were set up for every child born between 1 September 2002 and 2 January 2011, with the government contributing an initial deposit of at least £250. Funds can be withdrawn once the account matures when the child turns 18.

According to government data, nearly a million young people in the UK have yet to claim their Child Trust Funds. More than 800,000 accounts belong to people from low-income backgrounds – prompting concern that those who need the money the most are not accessing it.

Every 16-year-old is sent information about finding their Child Trust Fund from HMRC with their National Insurance letter. Anyone unsure about their situation should check with their bank or building society. Alternatively, young adults and parents can also search on www.gov.uk/child-trust-funds to find out where their Child Trust Fund account is held.

Gwyneth Ellis, Lead Member for Finance, Performance and Strategic Assets said:

“I would encourage all young people in Denbighshire to investigate if they have money which is unclaimed in a Child Trust Fund and to use it wisely. The investment could be placed into an adult ISA or put towards their education or driving lessons.

I would urge young people to use the online tool to track it down or, for parents of teenagers, to speak to them to ensure they’re aware of their Child Trust Fund. It could make a real difference to their future plans.

The money in a Child Trust Fund has the potential to be life changing and the lack of knowledge about them shows the importance of financial education and planning from a young age.”

There are currently 5.3 million open Child Trust Fund accounts. Young people aged 16 or over can take control of their own Child Trust Fund, although the funds can only be withdrawn once they turn 18. Families can continue to pay up to £9,000 a year tax-free into a Child Trust Fund until the account matures. The money stays in the account until the child withdraws or reinvests it into another account.

If a parent or guardian was not able to set up an account for their child, the government opened a savings account on the child’s behalf. The Child Trust Fund scheme closed in January 2011 and was replaced with Junior Individual Savings Accounts (ISA).

For more information on cost of living support in Denbighshire, please visit www.denbighshire.gov.uk/costofliving or contact Citizens Advice Denbighshire www.cadenbighshire.co.uk