What the Child Trust Fund Can Do for Your Son or Daughter,where to Invest the Two Hundred and Fifty Poundschild Trust Fund Voucher,Invest Your Free Child Trust Fund Voucher with Scottish Friendly,Investing in a Child Trust Fund Builds a Sound Financial Fo
Have you heard the news about the Child Trust Fund?Few UK parents remarkably
low number of parents appear to know about the fact that all newly born babies receive a free £250 voucher from the the State to put. The child’s vouchercan be invested in any one of threekinds of CTF account, Stakeholder – a shares-based account that swapsinto cash, a savings account or a shares account. It is a great opportunity to invest needs of a infant
Scottish Friendly is an authorised provider of the Child Trust Fund Voucher. The State is keen for the public at large to have access to Stakeholder accounts and this is the form of account that we offer. This means that:
• Investments are placed into Scottish Friendly’s Managed Growth Fund, which intends to provide strong growth potential
• It invests partly in shares to make the most of potentially higher returns over 18 years,compared to a cash deposit account (although the value of shares canfall as well as increase whereas capital would be protected in a deposit account)
• It comes with a low ‘Stakeholder’ funds charge of only 1.5% per year
• When attaining the age of 18 the young person will get a lump sum, entirely free of Capital Gains and Income Tax under present law
• It is very affordable – additional payments can be placed in the account from as little as £10
A major attraction of the Child Trust Fund is that anyone – parents, grandparents, aunts and uncles, friends – can contribute to the Fund to an uppermost limit of £1,200 per year to help augment the child’s Fund (once added, this money may not be withdrawn).
Put succinctly our Stakeholder account provides a good balance between potentially high returns and a reduced level of risk. There’s also the extra assurance that our account meets with the Government’s stakeholder criteria. Nonetheless this doesn’t mean that returns are assured or that Stakeholder accounts are suitable for everyone. Remember that the value of shares in the Managed Growth Fund (where your Child Trust Fund money is invested) can go down as well as increase and is not guaranteed.
Only infants born on or after 1st September 2002 are authorised to start up a Child Trust Fund. If you have older children who are not entitled you could consider investing for them with a Child Bond – it’s a tax-free savings plan aiming for long-term growth. There can be no doubt that saving for your son is a rewarding means of preparing for the world to come.
