Save Your Free Children Trust Fund Voucher with Scottish Friendly, so Your Child Can Have a Large Lump Sum of Money when They Reach Adulthood
Heard about the Child Trust Fund? Hardly any mothers and fathers markedly
sparse number of parents appear to be aware of the fact that all babies get a free £250 voucher from the the State to place in a Child Trust Fund. Your son or daughter’s vouchercan be invested in any one of threesorts of CTF account, Stakeholder - a shares-based account that changesinto cash, a savings account or a shares account. It is an excellent way to save needs of a youngster
Scottish Friendly is a designated provider of the Child Trust Fund Voucher. The State is keen for the public to have access to Stakeholder accounts and this is the type of account that we offer. This means that:
• Investments are sent into Scottish Friendly’s Managed Growth Fund, which seeks to provide strong growth potential
• It invests in part in shares to get the benefit of potentially higher returns over 18 years,compared to a cash deposit account (although the value of shares candecrease as well as rise whereas capital would be protected in a deposit account)
• It comes with a low ‘Stakeholder’ funds charge of just 1.5% per year
• When reaching 18 the young person will get a lump sum, wholly free of Capital Gains and Income Tax under prevailing legislation
• It is affordable - extra payments can be put in the account from as little as £10
A particularly advantageous aspect of the Child Trust Fund is that anyone - parents, grandparents, aunts and uncles, friends - can add to the Fund to an uppermost limit of £1,200 per year to help augment the child’s Fund (once added, this money is not allowed to be withdrawn).
In a nutshell our Stakeholder account offers a good balance between possible high returns and a reduced level of risk. There’s also the extra assurance that our account complies with the Government’s stakeholder criteria. However this doesn’t mean that returns are guaranteed or that Stakeholder accounts are suitable for everyone. Bear in mind that the value of shares in the Managed Growth Fund (where your Child Trust Fund money is placed) can fall as well as rise and is not guaranteed.
Only children who were born on or after 1st September 2002 are eligible to start up a Child Trust Fund. If you have older kids who are not eligible you could look at saving for them with a Child Bond - it’s a tax-free savings plan aiming for long-term growth. It is evident that investing for your children is a sound means of preparing for the future.
