Parents saving for children’s future with additional CTF contributions
The latest statistics from the Quarterly PIMA CTF survey reveal that more parents and relatives are making additional top-up contributions to CTFs.
The survey which covers approximately 62% of CTF accounts in the UK shows that take-up remains strong and increasing numbers of parents are using monthly direct debits and lump sum contributions to give their children the best chance for a larger CTF pot upon reaching 18.
The PIMA research from leading providers shows that parents and relatives are on course to make over £115 mn in additional contributions to the CTF. The most popular way of topping up CTFs is by direct debit, with 22.8% of parents and grandparents choosing this option. This is up 0.4% from the last survey. These supplements are projected to add over £85 mn in contributions to CTFs every year. The average contribution is just over £20 pcm.
Lump sum contributions remain an important method for adding additional funds to CTFs. Just under 6% of CTFs have had one-off contributions, a slight increase on the prevalence in the last survey. The average amounts contributed made a significant jump of over 17%– from £317 to £373. There has been roughly £30 mn in lump sum contributions.
[b]PIMA Director General Tony Vine-Lott said,
‘These are very encouraging numbers—everything is moving in the right direction. Parents are beginning to realise the importance of the CTF to their child’s future and they are acting on that by making additional contributions. Nearly 30% are making additional contributions—which is fantastic—but it’s not just about money. CTF provides a host of opportunities to focus on finances and is often a catalyst for increased financial capability for the whole family. We know from anecdotal evidence that this is already starting to make a big difference as families look to the future.’
‘We would like to see the number of parents and relatives making additional contributions to increase in the next few years, to 40-50%. PIMA is working with its membership and the Government to ensure greater participation by the public.[/b]
Notes to editors:
PIMA is the leading trade body for CTFs and tax incentivised savings. It has worked with the Government to develop and implement the CTF. This is the second quarterly CTF survey it has conducted.
PIMA wants to remind parents and their families that every eligible child could benefit from tax free saving of £1200 per year to build into a nest egg for them when they reach 18 years. If parents have questions or concerns, they should call or contact their CTF provider or contact the Government’s information helpline on 0845 302 1470 or by visiting www.childtrustfund.gov.uk.
For more information:
Tony Vine-Lott, Director-General, PIMA
07790 006108
Iain Anderson or Jacob Coy, Cicero Consulting
020 7665 9535
07886 197086