Thousands of young adults across the UK may be sitting on a tidy sum without even realising it. More than 670,000 people aged 18-22 have yet to claim their Child Trust Fund (CTF), with the average account balance holding £2,212.
HM Revenue and Customs (HMRC) is urging eligible individuals to track down and claim these savings, which could provide a welcome financial boost.
What is a Child Trust Fund?
A Child Trust Fund is a long-term, tax-free savings account set up by the UK government for every child born between 1 September 2002 and 2 January 2011.
The government designed this scheme to encourage people to save from an early age. To kick-start savings, the government contributes £250 to each account at birth. Parents save for their child’s future, and the child can access the funds when they turn 18.
Although the scheme ended in 2011, many accounts remain untouched, as thousands of young people have yet to claim their money. The funds are held by banks or other financial institutions and continue to grow tax-free until withdrawn.
How to Find and Claim Your Savings
For those unsure of where their Child Trust Fund is held, HMRC has simplified the process. With just a National Insurance number and date of birth, individuals can use the online tool on GOV.UK to locate their provider.
As Angela MacDonald, HMRC’s Second Permanent Secretary, notes:
“Thousands of Child Trust Fund accounts are sitting unclaimed – we want to reunite young people with their money, and we’re making the process as simple as possible.”
MacDonald also cautioned against using third-party agents who charge for services that can be completed for free through official channels.
Some agencies charge up to £350 or 25% of the savings value, but as HMRC highlights, there’s no need to pay for a service that’s easily accessible online.
Why These Funds Matter
For young people just starting out in adulthood, having an unclaimed savings pot could make a significant difference. Whether it’s used to cover education costs, pay for travel, or even start a business, an average of £2,212 could go a long way.
Gavin Oldham from The Share Foundation, which has helped link over 65,000 young people to their Child Trust Fund accounts, commented:
“If you are 18-21 years old, the government would have put money aside for you shortly after birth. This investment would have grown quite a bit, and it’s in your name.”
For many, finding and accessing these savings might take only a few minutes but could provide long-term benefits.
Child Trust Fund Facts and Figures
Aspect |
Details |
|---|---|
| Eligibility | Children born between 1 September 2002 and 2 January 2011 |
| Average Unclaimed Amount | £2,212 |
| Number of Unclaimed Accounts | Over 670,000 |
| Where to Find It | Online tool via GOV.UK with National Insurance number and date of birth |
| Third-Party Agent Fees | Up to £350 or 25% of the account balance |
Why So Many Accounts Are Unclaimed
There are several reasons why so many young adults have yet to claim their Child Trust Fund savings. For some, it may simply be a case of not knowing the funds exist, especially if parents or guardians were responsible for setting up the account.
In other cases, people may have lost track of the paperwork or forgotten about the savings as they entered adulthood.
However, as more people become aware of the funds available, the number of claims is expected to rise. In the past year alone, over 450,000 young people used the GOV.UK tool to locate their Child Trust Fund.
What Happens if You Don’t Claim?
The money in a Child Trust Fund remains secure even if it’s not claimed immediately. The funds will stay in the account until the owner either withdraws or reinvests them. However, leaving money unclaimed misses financial opportunities, such as tax-free growth in a Junior Individual Savings Account (ISA) reinvestment.
Act Now: It’s Simple and Free
For those who have turned 18 and suspect they might have unclaimed savings, now is the perfect time to check. As Oldham mentioned, it’s quick and easy to find your Child Trust Fund account by using the official online tools.
“It’s easy and free to find out where your money is. Go HERE or GOV.UK to locate it today.”
In tough times, uncovering these savings can offer significant financial benefits with just a few moments of effort.
Your money is yours to use for future planning or immediate needs – claim it, don’t leave it behind.
Sources: THX News & HM Revenue & Customs.
