Figures from the Building Societies Association have shown that 142,000 stakeholder child trust funds were opened by January, but the majority of money was being placed with cash child trust funds rather than in stocks and shares.
Providers that offer both cash and stakeholder options opened around 39,000 accounts in January alone, but 74% of parents opted for the cash child trust fund option where a choice was given.
Figures from HM Revenue & Customs show that many of these vouchers are uninvested, with 2.14 million vouchers being issued, but only 1.16 million accounts being opened, while Post Office figures show that one in four parents have yet to invest their £250 voucher and twenty six per cent of parents were unaware of the governments default option, where they invest unused vouchers on behalf of the parents with a random provider selected from a panel.
Our view
With roughly half of CTF vouchers not being used this clearly demonstrates to this and any successive government the need for financial education in the UK.
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