Families nationwide may be overlooking substantial sums of money held in dormant bank accounts, as recent data reveals. An estimated 758,000 young individuals are believed to have significant funds lying untouched in Child Trust Funds. The average unclaimed amount sits at an enticing £1,980, with potentially larger sums yet to be discovered. In the UK, there are approximately 27,000 unclaimed Child Trust Funds valued at over £10,000, along with 280,000 accounts holding more than £1,000, and 57,000 accounts containing £5,000.
A call to action has been issued to individuals aged 18 to 23 to investigate the possibility of lost accounts. The government suggests that hundreds of thousands of people could be unaware of substantial savings awaiting them, totaling around £1.5 billion in unclaimed Child Trust Funds.
Child Trust Funds, tax-free savings accounts established for children born between September 1, 2002, and January 2, 2011, can still be accessed despite the scheme’s closure in 2011. Upon reaching 16, the child gains control of the account, which matures by age 18, allowing them to choose whether to invest or withdraw the funds.
Parents were initially provided with a £250 deposit by the government at the program’s inception, which, through interest and investments, may have grown significantly over time.
Charlene Young, a pensions and savings expert at AJ Bell, highlighted that many unclaimed Child Trust Funds result from lack of awareness about the accounts’ existence, uncertainty regarding the fund’s provider, or difficulty in tracking down the funds. It is worth noting that failing to claim a Child Trust Fund account could lead to additional charges, with various providers imposing annual management fees, some as high as 1.5%.
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