The children of today will soon have to face the economic realities of the grown-up world. This means it is crucial to start thinking about saving when they’re young. Surprisingly that knowledge among mothers and fathers of children has been shown to be sketchy .
The position in the UK is that
newly born babies are given a free £250 voucher from the government to put. So there is clearly an opportunity available. The child’s vouchermay be invested in any one of threetypes of CTF account, Stakeholder – a shares-based account that switchesinto cash, a savings account or a shares account. It is a fantastic opportunity to prepare financial requirements of a child
Scottish Friendly is an authorised provider of the Child Trust Fund. The Government is keen for the public to have access to Stakeholder accounts and this is the sort of account that we are offering. This means that:
Investments are deposited into Scottish Friendly’s Managed Growth Fund, which intends to provide strong growth potential
It invests partly in shares to make the most of potentially higher returns over 18 years,compared to a cash deposit account (although the value of shares canfall as well as rise whereas capital would be protected in a deposit account)
It comes with a low ‘Stakeholder’ funds charge of just 1.5% per year
When reaching 18 the young person will get a lump sum, completely free of Capital Gains and Income Tax under current law
It is affordable – extra payments can be placed in the account from only £10
