Young people born on September 1, 2007, will be able to unlock their Child Trust Fund (CTF) savings for the first time this September as they reach their 18th birthday.
CTFs were first launched for children born on or after September 1, 2002. This means those turning 18 this year make up the fifth group to benefit from the Government-backed initiative, which was introduced to help families on lower incomes build a nest egg for their children’s futures.
The first vouchers were paid into accounts from January 1, 2005, when providers started opening CTFs on behalf of eligible children.
How much did the Government pay into CTFs?
Every child born between September 1, 2002, and January 2, 2011, received a £250 Government voucher when their CTF was opened. Families on the lowest incomes those receiving the full Child Tax Credit entitlement were given an extra £250, bringing the total to £500 for those children.
Some children also received a further top-up at age seven. However, changes to the scheme over the years mean the amounts varied. Children born between September 1, 2002, and July 31, 2010, received both the initial voucher (£250 or £500) and the age-seven top-up.
For those born on or after August 1, 2010, the age-seven top-up was removed, and all vouchers including the birth payment were stopped entirely when the scheme ended on January 1, 2011. Anyone born after this date did not receive a CTF voucher.
Can money be added to a CTF?
Yes. Families have always been able to pay into a CTF, and this is still allowed. Up to £9,000 can be added each year until the child turns 18. Each “year” runs from the child’s birthday to the day before their next birthday. Any unused allowance does not roll over, so it’s lost if not used.
CTFs grow free from tax until the account holder turns 18. At that point, the young person decides what to do with their money. They can take control of the account from age 16, but they can’t withdraw the funds until they are 18. When they reach 18, the fund can be cashed in, or it can be automatically transferred into an adult ISA to continue growing. The original CTF account then closes.
What if I don’t know who manages my child’s CTF?
If you remember which provider set up the CTF, you can contact them directly once your child turns 16 or 18, depending on whether they want to manage or withdraw the account.
If you’re unsure who holds the account, you can use the Government’s online CTF tracing tool on Gov.uk. You’ll need your National Insurance number and the child’s full name and date of birth. In some cases, the child’s own National Insurance number may also be required. Children who spent time in care were also eligible for CTFs, so it’s worth checking if this applies to you or someone you know.
The average CTF balance is now around £2,000, though some accounts will hold much more if regular contributions were made. Whatever the amount, the money is waiting for anyone turning 18 who was born within the eligible dates.
Get in touch
If you’d like help locating a Child Trust Fund or want advice on what to do once it becomes accessible, please contact us and we’ll guide you through the process.
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