Skip to content Skip to footer site map

What is going to happen to the Child Trust Funds at age 18?

Children with Child Trust Funds will begin to turn 18 from the 1st September 2020. Although this seems a long way away, it is important to start planning now.

We look after over one million children’s savings plans, so the countdown to the first Child Trust Fund Planholders reaching age 18 is a significant milestone to us, as well as to the children who will be able to use this money to help towards their first steps into adulthood. We are looking forward to celebrating this milestone with them.

Whether you are a child wanting to understand your options, or a parent wondering what is going to happen to the Child Trust Fund – we'll be providing you with all the information you need.

I would like to know more about my Child Trust Fund

teenagers

What is a Child Trust Fund?

The Child Trust Fund is a Government savings initiative that was introduced in 2005 and back dated to children who were born after the 1st September 2002. If you were born in the UK, your parents would have been given a voucher (ranging from £50 - £500, depending on your circumstances and when you were born) from the Government to place with a Child Trust Fund provider. The Government withdrew Child Trust Funds on the 2nd January 2011.

The Child Trust Fund can be invested in cash, or in stocks and shares (like the Child Trust Funds we hold). The Government limits the amount that parents, family and friends can contribute each year. This is currently £4,368 and the contribution year runs from birthday to birthday.

The monies saved by parents, family members and friends over the years help to boost the value of your Child Trust Fund, which you can access from your 18th birthday. 

 

What are the options going to be when I reach 18?

The Government have not yet finalised the options that are going to be available. As soon as we know more this information will be updated. Currently the following options are also being considered as alternatives to accessing the money in your Child Trust Fund.

1. The Child Trust Fund will automatically move to an ISA
2. You can instruct us to move the Child Trust Fund into an ISA
3. You can leave the money where it is

 

 

How will I access the money in my Child Trust Fund?

First we will need to identify you, after that access to your money is easy! Whether you are planning on taking some (or all) of the money, all you need to do is instruct us how you would like the money to be paid to you; bank transfer or cheque. 

If you haven’t already you will need to have an active bank account in your name so that we can make the payment to you.

 

What is an ISA?

An ISA is a tax-efficient way to save for the future. Our ISA is a simple and affordable option which allows you to continue to save towards your financial future and/or for that something special as well as allowing access to your money.

The Government has yet to confirm whether they will automatically move Child Trust Funds into ISAs. However if they do not, this is still an option that will be available to you, we will just require some paper work from you in order for you to continue to save.

You can save in a Forester Life ISA from as little as £20 and our ISA is the only ISA on the market that gives you the flexibility of combining both a Lifetime ISA and a Stocks and Shares ISA in one plan.

   

What happens if I leave the money where it is?

You can leave your Child Trust Fund where it is after your 18th Birthday. However we will not be able to accept any further contributions.

 

How will I know more about my Child Trust Fund?

We will keep this webpage up to date when we hear more information.

From the 28th January 2019, Her Majesty’s Revenue & Custom (HMRC) has included some information into the National Insurance Number letter you receive shortly before your 16th Birthday. Within this letter the following information is included:

“Child Trust Funds
When you turn 16, take control of your Child Trust Fund. Ask your parents or guardian, for more information go to 
www.gov.uk/child-trust-funds

HMRC have mentioned that you can take control of your Child Trust Fund. This means that you look after your Child Trust Fund, make any changes to the details of the Plan and we will write to you with any Child Trust Fund information, for example your statement. You do not have to do this; your parents can continue to look after your Child Trust Fund on your behalf, up until your 18th Birthday.

Whoever looks after the Child Trust Fund is referred to as the Registered Contact, this is either someone with parental responsibility or you, the child, at age 16 or over.

If you do want to look after your Child Trust Fund simply complete this Registered Contact Application form.

 

I have no Registered Contact for my Child Trust Fund

If your Child Trust Fund voucher was not invested on your behalf, the Government placed it with one of the Child Trust Fund providers. If so, your Child Trust Fund may not have a Registered Contact (the person who has responsibility for looking after the Child Trust Fund).

If someone with parental responsibility would like to become the Registered Contact, please complete this Registered Contact application form. Or if you are aged 16 or over and would like to become the Registered Contact for your Child Trust Fund please complete this Registered Contact Application form.

 

I would like to know more about Foresters Financial

Foresters Financial is an international financial services organisation helping more than 3 million customers and members, in the UK, Canada and the US, achieve their long-term financial goals.

We are more than a financial services provider; for over 140 years we have helped our members make a difference in their communities. Our members and their families take part in hundreds of different community days each year, ranging from community beautification, such as beach cleans, supporting charities, refurbishments and making care packages for the less fortunate.

We have helped families build financial security and help each other make a difference in their communities.

We are driven to share, not shareholder driven.

What parents need to know about their child's Child Trust Fund

teenagers 

I would like to know more about my child’s Child Trust Fund

We know that some parents may have decided to keep this as a surprise for their child and have been saving over the years. Although this is a perfect gift, to help with university, towards a new home or even a new car, don’t let the surprise be spoilt by someone else – start talking to your child about their Child Trust Fund.

Talking to your child about finances can be a tricky topic for conversation, as parents you are their go-to for help and advice –  the information on our Child Trust Fund Hub should help answer some of those questions.

The Government are still considering the options available for Child Trust Funds at age 18 and we will continue to update this page as and when further details are announced.

 

 

Will anyone write to my child about their Child Trust Fund?

Yes. HMRC have included some information about Child Trust Funds into the National Insurance letters your child will receive shortly before their 16th Birthday. Within this letter the following information about Child Trust Funds is included:

“Child Trust Fund
When you turn 16, take control of your Child Trust Fund. Ask your parents or guardian, for more information go to
www.gov.uk/child-trust-funds

So your child may come to you with some questions.

Although HMRC have mentioned your child should take control of their Child Trust Fund at age 16, there is no requirement to do so. You may want to discuss this with them, if they wish you can continue to look after the Child Trust Fund up to age 18.

Additionally, more information will be available in the media and children may start talking to each other about their Child Trust Funds.

 

Can I contribute to my child’s Child Trust Fund after age 18?

No, after your child turns 18 we will no longer be able to accept any gift payments into the Child Trust Fund.

 

  

What are my child’s options?

The Government have not yet finalised the options that are going to be available from the 1st September 2020. As soon as we know more our information will be updated. At age 18 your child will be able to access the money in their Child Trust Fund if they wish. Currently the following options are also being considered.

1. The Child Trust Fund will automatically move to an ISA
2. Your child can instruct us to move the Child Trust Fund into an ISA
3. They can choose to leave the money where it is

 

Information on this page is based on our current understanding and may change in the future. This information will be updated accordingly.

HAVE YOUR SAY
We would love to hear your feedback on your latest website visit. Take this two minute survey

Looking for more information? Find out about your Child Trust Fund with us