Saving Money Child Trust Fund Accounts

Why not give your new baby a great start in life, with Wrexham Credit Union.

Using your vouchers from the Government, and topping up the account when you can, you could build up a fund that will give your child a helping hand when they turn 18 with driving lessons, a first car, a university education, or even the deposit on a house.

Any child born on or after 1^st September 2002, living in the UK and registered for Child Benefit receives a Child Trust Fund (CTF) voucher from HM Revenue & Customs for at least £250.

You can use this voucher easily with Wrexham Credit Union. Complete the application form and bring it to us with the voucher, copy of the birth certificate and the letter showing the child benefit payment. Top it up regularly and by the time they're 18 it could be worth thousands – you, family and friends can all deposit money, up to £1,200 per year tax-free.

Our cash savings Child Trust Fund is a long term risk free deposit account. When your child is 18 they get the money deposited plus additional interest payments. Our Child Trust Fund offers:

• Safe, local savings
• Competitive interest rate
• Transfer from other providers
• Regular top up payments or save when you can – no minimum amount
• Choice of easy deposit methods, including standing order
• No set-up, closure or management fees

There are three types of CTF account available. The other types of Child Trust Fund are stakeholder and non-stakeholder investment accounts, usually linked to the stock market, where the value can go up or down, making them more risky but with the potential to offer greater returns.

Interest rates on our cash savings Child Trust Fund account are set by the Board of Directors, and interest is paid once every year. Our present interest rate is 4% and will be reviewed on a regular basis by the Board of Directors.

If you've already had your voucher, or been allocated an account by the government, why not transfer it to Wrexham Credit Union. It's easy to transfer in, just ask for the forms and drop them back to the office...

Stakeholder Child Trust Fund Account

A stakeholder investment-based account is available from Scottish Friendly Assurance. Payments into their stakeholder Child Trust Fund account buy shares in their Managed Growth Fund, which invests in company shares, government bonds and cash with the aim of providing long term capital growth. Charges on the account are capped at 1.5% per year.

The fund is not guaranteed and there is a chance that the fund may not be worth as much as the value of contributions made to the account.

But it is possible that over the long term contributing to an account which invests in stocks and shares will produce a higher return than depositing money in a cash account. As a stakeholder account it is subject to rules which the Government has made to reduce the risk of investing in shares. You can get further details of the Scottish Friendly Assurance Child Trust Fund account by contacting them on 0800 955 5995 or by logging on to their website: www.scottishfriendly.co.uk/abcul/child-trust-fund/