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25% of parents have yet to claim their free £250 from the government. With a CTF opened, you can contribute tax free to the fund, and watch it grow into a great nestegg that your children can access only once they have turned 18.
Alternative to CTFs
Tax Exempt Saving Plans (TESPs)
One of the best ways to save for your children's future is the Tax-Exempt Savings Plans (TESPs) from friendly societies. TESPs offer parents a simple way to save up to £25 for each family member per month in addition to, or instead of, a CTF.
TESPs can help you build up a lump sum for any child through small regular payments. You choose when the money is available for them, but the policy must run until they’re at least 16 and run for a minimum of 10 years.
TESPs are available for every member of the household so a family of four could save up to £100 a month tax-free and, provided the TESPs have been set up in the parent's names, the money remains firmly under their control. In addition, the flexibility of TESPs mean that they can be set up to mature at different points in a child's life.
Providers with TESPs Engage Mutual Assurance
The Child Trust Fund (CTF) is an account for children who were born after 1 September 2002. Each child receives £250 from the government to be invested in a CTF account. Key benefits are as follows:
£1,200 extra can be saved each year
It is totally tax free
When the child is 7 the Government will make a further contribution
Jump Savings offers both a CTF and a Savings Plan. The Savings Plan is designed for older children who don’t qualify for the CTF or for those parents who would prefer more flexibility than the CTF allows.
