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CTF popularity grows

CTF popularity grows

Category: Savings

Updated: 12/04/2010
First Published: 12/04/2010

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
The popularity of Child Trust Funds (CTF) continues to grow, according to the latest quarterly survey from TISA (Tax Incentivised Savings Association).

The average monthly amount paid into the accounts by direct debit has increased to £23.14, while an additional 31,560 accounts have had regular payments set up in the past three months.

Meanwhile, a further 29,000 CTFs received a one-off cash injection during the quarter worth more than £13 million in total, over double the amount paid in during the previous quarter.

The average lump sum contribution now amounts to £507.

"I am particularly pleased that our message is getting through that money given as a gift can be put into a CTF," said Tony Vine-Lott, TISA Director General.

"This survey covers the Christmas period and the large uplift in lump sum contributions is an indication that parents have saved presents of money into their child's CTF.

"It is often overlooked that CTFs are a recognised savings product that enable friends and family to contribute to a financial nest egg that only the child will be able to access and only when they reach age 18.

"This means that CTFs benefit all children regardless of their background and this, along with the role the scheme has in improving financial literacy, should be borne in mind in any debate about the future of CTFs."

Savings into a CTF are tax free and up to £1,200 can be contributed each year.

However, the future of the CTF still remains unclear, with the Conservative's set to restrict the initiative to all but the poorest families, should they win the election.

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