CTFs retain popularity despite uncertain future - Savings - News - Moneyfacts

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CTFs retain popularity despite uncertain future

CTFs retain popularity despite uncertain future

Category: Savings

Updated: 25/01/2010
First Published: 25/01/2010

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 It is now over 6 months old so the content may be out of date.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 future of child trust funds (CTF) may be uncertain, but figures show that they continue to attract strong growth.

The funds have split political opinion, with the Conservatives planning to scrap new CTFs for all but the poorest families. Labour has pledged to continue its support of the initiative.

However, the funds continue to benefit from contributions by parents and other family members.

Over half a million new CTFs were opened in the final quarter of 2009, according to the latest survey by the Tax Incentivised Savings Association (TISA). The number of the accounts finished the year totalling just over 3,523,000, rising from almost three million at the end of quarter three.

The figures represent just shy of three quarters of all CTFs in the UK, and show that around 708,000 had active direct debit subscriptions totalling £16,223,791.

In addition, 265,176 CTS have benefitted from a lump sum subscription, to bring the total subscriptions to date in these accounts to over £136 million.

"CTFs play a dual role in helping to improve the financial literacy and in providing a savings nest to assist young people meet the financial demands on them when they reach 18," said Tony Vine-Lott, director general of TISA.

"The significance of these two factors must not be overlooked in any debate about the future of CTFs," he urged.

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