The Government will be sending out entitlement letters to parents with children born after September 2002 this month. The letters pledge a payment of at least £250, with a further £250 going to poorer families.
The money can be invested for the child in cash (through a bank or building society) or in stocks and shares through an investment fund.
Our View
The general idea of the trust fund is great, as it will give a financial boost to children coming of age. However, for those people investing in stocks and shares care needs to be taken in terms of ongoing performance, as losses could be made.
For those investing in cash, making sure you receive competitive interest rates is imperative, if your child is going to reap the maximum rewards.