As many as 760,000 UK households are being urged to grab as much as £2,000 each – and possibly more.
Students are returning to college and university across the UK this month and the cost of paying for halls (or just going out after lectures…) can quickly add up. But there are as many as 760,000 matured Child Trust Funds currently waiting to be claimed by people in college and university right now, worth an average of £2,000 each, according to HMRC.
The Financial Conduct Authority has today urged both young adults and their parents to check if they have a forgotten fund in their name.
It says: “As students return to college and university this month, the FCA is urging young adults and parents to check whether they have a forgotten Child Trust Fund waiting to be claimed – potentially worth thousands of pounds.
“Figures from HMRC show that 760,000 matured Child Trust Funds, worth an average of £2,000 each, remain unclaimed. That means hundreds of thousands of young people could be missing out on money that could go towards new laptops, textbooks, rent deposits or the everyday costs of student life – or setting them up with savings for their future.”
However, don’t be fooled into parting with cash to get the money. Some unscrupulous firms are offering to find and claim Child Trust Fund accounts in exchange for a fee, but middle men aren’t necessary and you’re paying money for nothing.
The FCA adds: “Some companies, including those advertising on social media, are offering to ‘find’ and claim Child Trust Funds on people’s behalf – often for a hefty fee or a cut of the final payout. The FCA has seen cases where customers were charged £400 to locate the account and even seen some firms charging a monthly subscription for a one-off tracing service. But missing funds can be traced for free without losing a penny to a middleman.”
Tracing a Child Trust Fund might be offered by firms who are regulated by the FCA, for example as claims management companies. But the tracing service itself is not an activity that generally needs FCA authorisation. This means firms offering this service may not be covered by the FCA’s cap on claims management fees and customers may not be able to take complaints to the Financial Ombudsman Service.
Chris Knight, director of insurance at the FCA, said: “A Child Trust Fund can be a welcome source of extra cash at a time when many young people need it most. But you don’t need to pay someone else to claim what’s rightfully yours – tracing and accessing your own Child Trust Fund costs nothing, so think twice about handing over a chunk of your savings to a claims firm for a job you can do yourself.”
Myrtle Lloyd, HMRC’s chief customer officer said: “If you’re between 15 and 24, you could be sitting on a savings payout and not even realise it. Just search ‘find my Child Trust Fund’ on GOV.UK to find your savings account today.”
