Thousands of young adults missing out on funds worth thousands – could you be one of them?

HM Revenue and Customs (HMRC) is urging over 670,000 young adults aged 18 –- 22 to check if they are owed unclaimed child trust funds (CTF).  

Angela MacDonald, HMRC’s deputy chief executive, said that thousands of CTF accounts are sitting unclaimed and they want to “reunite young people with their money” and make the process as simple as possible.   

What are child trust funds?  

CTFs are long-term, tax-free savings that were set up for every child born between 1 September 2002 and 2 January 2011.  

The government initially contributed £250 to each account, with children from low-income families or those in local authority care receiving an extra £250. 

The funds can be withdrawn when the child turns 18.  

Parents, guardians and other family members can pay up to £9,000 a year into their child’s account. Even without additional payments, most funds are worth much more than when they were set up, thanks to interest.  

HMRC says the unclaimed cash is worth an average £2,200. 

CTFs were introduced by the Labour government in 2005 to encourage parents to save for their child’s future. They were gradually phased out and were scrapped completely by the Conservatives in 2011.   

They were replaced by junior individual savings accounts (ISAs). Although they have similar long-term, tax-free benefits, these children’s savings accounts don’t include government contributions.  

How to claim your CTF   

Young people are encouraged to contact their CTF provider if they know who the account is with.  

If you don’t know the provider, you can visit ‘find your child trust fund’ on the government website. You will need to have your national insurance number to hand.  

More than 450,000 people have successfully located their child trust funds by using the government’s free checker tool.  

What can you do with the funds?  

Once you have accessed the fund, there are several things you can do with it. You can withdraw the money, transfer it to an adult ISA or leave it sitting where it is.