March saw the lowest take up of Child Trust Funds since their launch a year ago, according to the latest figures from the Building Societies Association (BSA).
Its latest research reveals 21,000 Child Trust Fund accounts were opened in March by providers that offer both the cash and stakeholder option.
In all, 62% of parents opted for the cash option in March, where a choice was offered while net receipts into cash Child Trust Funds in March stood at £7.8m
To date, 374,000 cash Child Trust Fund accounts have been opened, with £125m held in total balances.
Brian Morris, head of savings policy at the Building Societies Association, says market share among cash providers of Child Trust Funds has remained fairly constant over the last twelve months and that it seems likely this months figures will be reflected in the wider CTF market.
"It seems parents are not taking on board the need to open a CTF as soon as possible after receiving their voucher, if they are to maximise the benefit to their child. Consequently, many are being allocated CTF accounts by the government - and missing out on 12 months’ interest or equity growth,” Morris says.
"Those parents who have failed to open a CTF for their child and find they are not happy with the account they have had allocated to them, should remember they still have a choice. CTF accounts can be transferred at any time, and for those parents whose initial opportunity to choose has been missed, it’s time to get moving and think about where they would like their child’s money to be invested, particularly if the stakeholder is not their preferred option."
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Matthew West on 020 7484 9893 or email matthew.wes[email protected].IFAonline
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