HM Revenue and Customs has launched a campaign to reunite young Britons with forgotten Child Trust Fund (CTF) savings accounts, which typically hold an average balance of £2,200. The tax authority is contacting 21-year-olds who have unclaimed accounts, as many in this age group are expected to be in work or have accessed student finance, meaning up-to-date contact details are more likely to be held.
CTFs were introduced by the Labour government in 2005 for children born between September 2002 and January 2011. Many children received around £250 from the government when the account was opened, with an additional £250 available for those from low-income families or in local authority care. Parents were encouraged to take control of the fund and could contribute up to £9,000 a year. If no account was opened within 12 months of a child's birth, HMRC opened one on their behalf, with the initial government stake invested in the stock market.
The accounts are held with banks, building societies and other savings providers, rather than by the government. Once the account holder turns 18, the CTF matures, allowing the owner to withdraw or reinvest the money. Of the more than 6 million CTFs created, over two-thirds are now held by people over 18, yet more than 750,000 accounts remain unclaimed.
City minister and economic secretary to the Treasury, Lucy Rigby, said: “Hundreds of thousands of young people in this country don’t know they have a CTF, let alone how to access it. Some will have a couple of thousand pounds sat there that would really help them as they begin adult life.” This week, Rigby met stakeholders, including representatives from HSBC and Nationwide, to discuss ways to connect savers with their accounts.
Young people can use the government’s free online tool to track down their account, or contact their savings firm directly if they know where the account is held. The Share Foundation charity, which has called for HMRC-allocated accounts to be automatically released when holders turn 21, can also assist with the search. In the first phase of the campaign, HMRC is writing to all 21-year-olds with unclaimed accounts, urging them to take action.
