Child Trust Fund Rates Cut
Published / Last Updated on 31/07/2010
by Ashley Clark, Director
Child Trust Fund payments from the Government to new born babies born after today will be cut by up to 80%.
A baby born today will receive a Child Trust Fund savings voucher of £250 (£500 for low income families) but a child born on Monday 2nd August will receive just £50. A lower income family ‘new-borns’ will receive a £100 Child Trust Fund Voucher.
In addition, the top up for children when they reach 7 years old of a further £250 has also been scrapped in England. Although, in Wales, the Welsh Assembly will continue a top for 7 year olds of £50 (£100 low income).
The move is another part of the Con-Lib Governments plan to make savings where possible and is thought to save the Government around £0.5 billion per year.
Child Trust Funds still remain with the facility for parents to save up to £1,200 pa in a cash or stock market linked savings account for a child and for the benefits to grow tax free - although for most children, they can have tax free investments anyway.
We actually see little point in continuing what is essentially a ‘failed’ savings plan.
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