Nov 14 2005
Up to 50 per cent of the two million Child Trust Funds (CTFs) issued in April have yet to be invested, but new research proves the vouchers are proving a success.
A survey by Barclays reveals that the introduction of CTFs has encouraged almost half of parents to invest more in their children's futures.
In April almost two million CTF vouchers were issued to parents of children born after September 2002, but almost half are yet to be invested.
However, the vouchers have fuelled parents' interest in savings for their children, according to the Barclays survey which found that around 70 per cent of parents would invest £250 in an equivalent account for an older child to ensure both offspring benefited equally.
And 81 per cent of the parents surveyed said they would make regular contributions to both children to ensure they had a safety net as they get older.
Stephen Ingledew, director of Barclays Financial Planning, told the Sunday Herald: "CTFs are not just about creating a nest egg for one child in the family, but should extend to raising awareness of the need to save as much as is feasible for all children, as well as teach them the benefits of saving rather than spending.
"It seems parents are taking this message on board and adapting their behaviour accordingly, which will hopefully help create future generations of savers."
Karl Elliott, marketing director and child savings strategist at Engage Mutual Assurance, added: "We have noticed an increase in inquiries about savings schemes for older children.
"I think the motivation among parents with children on either side of the CTF age limit is to do something that keeps everything fair."
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