Parents unaware that Child Trust Funds can be transferred to better savings provider

Under performing Child Trust Funds can be transferred to a better savings provider, however 50% of parents are unaware of this, according to findings from Yorkshire Building Society.

Many parents are leaving their children’s savings in poorly performing Child Trust Fund (CTF) accounts and 50% of parents surveyed did not realise that they could transfer the account to another provider.

With historically low interest rates hitting CTF savings hard, the Building Society found that 41% of its CTF accounts had been contributed to by parents wishing to boost their children’s savings.

Some parents are shopping around for the best CTF rates, however.  Yorkshire Building Society has seen a 20% rise in Child Trust Fund applications in the past month.

Finding the best performing Child Trust Fund will gain in importance as parents who opened a CTF account in 2002 will be receiving their second voucher from the Government next month.

Saving regularly into a CTF can create a sizeable savings pot for when the child reaches 18.  For example, saving just £10 per week from Birth in a Yorkshire CTF will create a savings account worth almost £12,000 by the time the child is 18.

Chris Edwards, Yorkshire Building Society’s Head of Savings & Mortgages comments that “Child Trust Funds are a really good way for parents to save for their child’s future. However, we’re urging parents who have existing Child Trust Funds or those who are in the process of choosing a provider, to shop around for a good deal.”