UK Parents Inactivity Harming Their Children?s Future University and Mortgage Savings

The British government at the beginning of this year officially launched its Child Trust Fund (CTF) initiative in an effort to encourage parents and children to develop the savings habit and to teach children the value of saving their own money.

Chancellor, Gordon Brown said, "The Child Trust Fund is designed to ensure that every child in our country has assets and wealth and that no child is left out and all children in Britain have a stake in the wealth of the nation".

The basis of the CTF scheme is that every child born in the UK on or after 1 September 2002, will receive an initial Government payment of ?250-?500 (depending on family income), which must be placed into a tax-free CTF savings account which cannot be accessed for withdrawals until the child reaches 18 years of age. Additional contributions to the account can be made by the child's family or friends, and the government also plans to make another payment to children on their seventh birthday. Parents that do not invest the government's gift within a year will have it invested for them by the Inland Revenue.

This 'free money' for children idea seems on the face of it to be a great idea for parents. A recent survey by the Halifax has shown that, of those parents who have already opened a CTF account, six out of 10 planned to make further contributions, and wanted their children to use the cash from a matured CTF to pay towards a university course. The survey also showed that 28% of parents hoped the cash could be used to buy a car, while 19% hoped the money could be put towards a deposit for a flat or house.

Although some families have taken to the idea by quickly investing the funds to maximise the cash return for their child when they reach 18, with figures from HM Revenue and Customs recently showing that nearly half a million CTFs had been opened, others have been more reticent, with approximately 1.2 million CTF vouchers sent out to parents still not invested.

A study by Abbey found that of those who had so far not invested their CTF voucher, nearly two-thirds stated that they, "just hadn't got round to it yet", while about one-quarter had not invested the money because they did not know which supplier to choose.

Another problem that has been recently highlighted is the lack of provision that has been made for Islamic children, as none of the existing CTF accounts complied with Sharia law. Under Sharia law, it is forbidden to give or receive interest or to invest in unethical firms. This meant that, in order to use the voucher, parents of the 120,000 eligible Muslim babies could only choose non-Sharia compliant accounts. Thankfully, in a move welcomed by the government, the first Sharia compliant CTF has just been launched by Children's Mutual, allowing a growing community of people who were previously reluctant to invest their CTF, the opportunity to benefit from CTFs.

The take-up of the CTF has proved to be extremely disappointing for the Government, with those who have not so far invested their voucher being at risk missing out on valuable growth to their fund. Ray Milne, managing director of Halifax Financial Services, said that "Most parents probably still have opening a Child Trust Fund on their 'to do' list, but we're urging them to act now and ensure their children benefit from their investment".

Whilst many view the whole idea of the CTFs as a waste of tax-payers money given the ensuing pensions problem that is looming, others see that any benefit to future university students would be overshadowed by the rising cost of university tuition fees.

"For those who choose to go to university it is a particularly hollow gesture as the government will give them a few hundred pounds in cash and at the same time a mortgage-style bill in tuition fees," stated Phil Willis, the Liberal Democrat education spokesman.

Whatever your opinion of the scheme itself, it seems that even the majority of those whose children will benefit from the fund are either not interested or feel they do not have enough knowledge to choose a provider. While the government can produce expensive adverts to raise pubic awareness and companies can provide information on the accounts that are available, the public's fear and apathy regarding all things related to personal finance may prove a more difficult hurdle to overcome, and this may be a problem that not only affect us, but will also lead to many of our children paying the penalty in later life.

Further information:

shariah compliant ctf

shariah compliant ctf

shariah compliant ctf

Richard works in Edinburgh for a media company, occasionally writing for the personal finance blog Cashzilla, and drinking too much coffee.

professional maid services Deerfield ..
In The News:

Researchers discover phishing scam using invisible characters to evade email security, with protection tips including password managers and two-factor authentication.
iPhone and Android users can reduce battery drain and data usage by restricting Background App Refresh to Wi-Fi connections instead of mobile networks.
Scammers nearly stole an Apple account by exploiting the support system with authentic-looking tickets and phone calls, users can protect themselves with safety steps.
FoloToy restored sales of its AI teddy bear Kumma after a weeklong suspension following safety group findings of risky and inappropriate responses to children.
Threat intelligence firm Synthient uncovers one of the largest password exposures ever, prompting immediate security recommendations.
Viral video shared by Elon Musk shows Tesla's Optimus humanoid robots performing tasks from cooking to construction, garnering over 58.5 million views on social media.
Chinese hackers used Anthropic's Claude AI to launch autonomous cyberattacks on 30 organizations worldwide, marking a major shift in cybersecurity threats.
Apple's new Sleep Score feature gives you a rating for your nightly rest quality. Learn how to set it up on your Apple Watch and iPhone today.
Essential phone settings to enable before losing your device, including Find My network, location services and security features for iPhone and Android.
The Fox News AI Newsletter gives readers the latest AI technology advancements, covering the challenges and opportunities AI presents.
Cybersecurity research shows weak passwords remain a major threat, with simple patterns and number sequences putting millions of accounts at risk.
New Android malware BankBot YNRK silences phones, steals banking data and drains crypto wallets automatically. Learn how this advanced threat works.
FDA approves first human trial for Paradromics' brain-computer interface that could restore speech for paralyzed patients through neural technology.
New phishing platform QRR targets Microsoft 365 users across 1,000 domains in 90 countries. Learn how to spot fake login pages and protect your accounts.
OpenTable now uses AI to track your dining habits and share insights with restaurants. Learn what data they collect and how to protect your privacy.
Google's discontinued Nest thermostats still secretly upload home data to company servers despite losing smart features, raising serious privacy concerns.
New Android malware NGate steals NFC payment codes in real-time, allowing criminals to withdraw cash from ATMs without your card. Learn protection tips.
DoorDash confirms data breach exposing customer names, emails, addresses after social engineering attack. Learn how to protect yourself from scams.
Concerned about Google's AI scanning your Gmail? Learn how to disable Gemini features that access your emails, Drive files and Chat messages for privacy.
Google warns Android users about dangerous fake VPN apps hiding malware that steals passwords, banking details and personal data from phones and tablets.
Apple's digital passport feature lets iPhone users breeze through TSA checkpoints this holiday season using Digital ID technology at 250+ airports.
A new phishing scam targets family photos with fake "Cloud Storage Full" alerts. Criminals steal credit card information through fake sites. Learn protection tips.
South Korean scientists create ultra-thin fabric muscles that turn clothes into robotic assistants, lifting 33 pounds while weighing under half an ounce.
Archer Aviation has acquired Hawthorne Airport for $126M to launch an LA air taxi network ahead of the 2028 Olympics, featuring AI-powered eVTOL operations and next-gen aviation tech.
Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Top 10 Ways Managing Your Money Is Just Like Riding a Bike

An avid cyclist and bike racing fan, I sit transfixed... Read More

5 Ways to Absolutely Destroy Your Finances!

Ben Stein has a book called How to Ruin Your... Read More

What Are We Teaching our 2005 Graduates about Money?

Now that we are in the month of June I... Read More

Introduction to Australian Superannuation

Australians, in general, constitute some of the worst savers in... Read More

Are You Sick of the Financial Insecurity of Fluctuating Seasons and Income?

Finding a stable and secure income that will come year... Read More

Planning Ahead with Your Finances

If you, like most people, have not seriously considered what... Read More

How To Free-Up 10% to 15% of Your Income

Would you be interested in freeing up 10% to 15%... Read More

The Magic Of Compound Interest

Christians are called to be good stewards of God's resources.... Read More

Understanding and Controlling Your Finances

Have you ever wondered what it would be like to... Read More

Eight Ways To Sink Yourself Financially

1. Don't focus on your finances.The reason most people get... Read More

Know Thy Finances

The first step to financial success lies in knowing your... Read More

One Income Source Is Not Enough!

My personal opinion is that in today's new economy, it... Read More

How To Protect Yourself Against Identity Theft

Identity theft is a serious crime that continues to grow.... Read More

Money Matters - Really!

One of the biggest challenges facing black RELATIONSHIPS today are... Read More

The Changing Shape of Family Finances

Super-mumsIt seems that the proof of maternal efforts is no... Read More

Budget Planning - Its Elementary My Dear Watson

Does it feel like you have to be Sherlock Holmes... Read More

Affording a Home

Can you really afford a house? If so, how much... Read More

Honor Those Who Serve with Checking Account Supplies

Our global society has had a wake up call in... Read More

How to Attain Your Dreams on a Single Income

If you recently became a single parent and see your... Read More

10 Quick And Cheap Ways To Cut Your Heating Bill

When you received an energy (heating) bill last winter, were... Read More

How Check 21 Affects You

The Check 21 Law is the new federal law for... Read More

Top 10+ Ways to Jumpstart your New Year?s Finances!

Of course, these don't have to be done in any... Read More

How To Place an Online Order for Checks ? It is Easy as 1-2-3

If You Have an Existing Account and 5 Minutes, You... Read More

The Good and the Bad of Money Management

Good money management needn't be difficult. In fact, there a... Read More

10 Steps To Improve Your Financial Situation

Here are ten steps you can follow to help improve... Read More

quick home cleaning Lake Forest ..