The Children's Mutual Reports Parents Persist In Saving
on: January 29, 2010, 11:52 am
Author: The Children's Mutual
The Children's Mutual, a leading Child Trust Fund provider,
has reported that the latest figures from HM Revenue and Customs (HMRC)
show that parents are persisting in saving for their children and
engaging with the Child Trust Fund.
The new quarterly Child Trust Fund
statistics released by the HMRC have revealed that nearly three quarters of all
Child Trust Funds (CTFs) are proactively opened within a year of a child's birth.
However, according to a new analysis from The Children's Mutual, this figure only
tells part of the story of parents' engagement with saving for their children.
The award winning Child Trust Fund provider found that while the vast majority of parents open an account for their child
rather than waiting for the Government to do so, many of those who don't are making
a proactive decision not to while others are understandably busy with their new
David White, Chief Executive of The Children's Mutual, said: "Because the CTF is universal, every
single eligible child receives an account, but what is impressive is that nearly 75%
of parents choose to proactively open the account and around half of our customers
start saving on a monthly basis immediately."
According to its research among parents of young children, over one in 10 parents
actively choose not to open an account and to let the Government do so on their
behalf, citing their lack of familiarity with financial matters. In addition,
research among parents who haven't opened accounts found that 27% say it is because
they haven't had time to think about it - not surprising considering a new baby has
a profound effect on family life.
Mr White said: "Attention is often paid to the quarter of parents who do not open
accounts, accusing them of not engaging with, or being interested in the CTF, but
our research shows that parents are far more engaged than many would believe. We
found that over one in 10 parents, with CTF vouchers to place, said they would choose to let the Government open their child's CTF and
of those who haven't opened accounts, the number one reason is because they are
understandably focusing on the here-and-now. The beauty of the CTF is that it
allows for this, with the Government opening accounts on behalf of parents if they
don't do it themselves, meaning that no child will miss out.
"Engaging 85% of the population to do anything is phenomenal when you consider that
when it comes to matters financial just 40% of the adult population has a private
pension and only 30% of those eligible have an ISA. The Child Trust Fund has done
what no other savings product has done before - captured the imagination of the
general population - and parents should be praised not chastised for acting in the
interests of their children and recognising the importance of saving over the long
term particularly at such a busy time in family life."
Child Trust Funds are designed to provide a tax efficient, long term savings vehicle
for all eligible children. Each eligible newborn child (born on or after 1 September
2002) receives a £250 Child Trust Fund voucher (£500 for low income families) from
the Government when their parents register for Child Benefit. The Government will
make a second contribution of £250 (£500 for low income families) when the child
reaches seven and is considering a third in the child's teenage years. Parents,
family and friends can all then add to this account up to a maximum value of £1,200
- Ends -
Notes to editors
About The Children's Mutual - Home of the Child Trust Fund
The Children's Mutual's mission is to help parents, grandparents, family and
friends fulfil their hopes for today's children. The Children's Mutual is the only
UK company which specialises in long term savings for children and is now the choice
of 1 in 4 parents for their child's Child Trust Fund, with more than 750,000
accounts. This expertise has led several financial institutions and family-focused
high street retailers to choose The Children's Mutual as their stakeholder Child
Trust Fund provider.
Contact Details: Katie Donlan
22 Endell Street
020 7781 2376