Family Investments has announced that it has now more than 1 million Child Trust Fund accounts. The company also said that it now has over 1.1 million accounts in total and is the first provider to reach this milestone. Family Investments has announced that it has now more than 1 million Child Trust Fund accounts. The company also said that it now has over 1.1 million accounts in total and is the first provider to reach this milestone.
Child Trust Funds were launched in 2005 by the government as a means of encouraging parents to save for the long term financial futures of their offspring. The scheme was backdated so that any child born on or after September 1st 2002 received a voucher worth £250 (£500 for children from low income families) to be invested until the child reached 18. In addition to the voucher given at birth, children currently receive another voucher worth £250 (£500) on their seventh birthday. Parents, family and friends can also make additional monthly or ad hoc contributions to the Child Trust Fund up to £100 per month for regular savings or £1,200 per annum in total. Funds in accounts cannot be accessed until the child reaches 18 but parents can change provider and the type of account in which the funds are invested at any time. Providers offer a range of accounts from those that perform like deposit accounts through to ones invested in funds, stocks and shares.
John Reeve, chief executive of Family Investments believes that the 1 million account milestone consolidates his company's position as a leading provider and proved the wider success of the Child Trust Fund programme. Already over £2billion has been invested into 4.6 million accounts. The tax free status of the accounts is also encouraging additional savings by parents and friends of £289 million per annum.
In addition to selling their own Child Trust Fund accounts, Family Investments took over the administration of around 400,000 accounts from Abbey and LV= and became the provider for Abbey.
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