According to Standard and Poor's, many parents will not be able to fund university fees with their Child Trust Fund vouchers. Paying for university education was behind the Governments' child trust fund campaign, but if a fund is left for 18 years with only the governments' £250 contribution invested, it will only grow to around £461, which is an £8,039 shortfall. The same amount invested in the FTSE Share Index would be worth £1,079. The cost of funding university students is estimated to be around £8,500 per year, which is why parents are recommended to invest in stocks market based child trust funds, rather than cash options, to try and secure the best investment return.
Our view
If the Government really think that a £250 voucher is going to encourage people to save more they are living on a different planet. Policy advisers have literally thrown taxpayers money away. In addition, the costs associated with children and their education will get even worse as time moves on. If you would like us to calculate your likely costs, please contact us for your FREE consultation.