Parents successfully invest in their children’s future through CTF
[list][*] Tomorrow’s children will benefit from over £100 million in voluntary contributions to the CTF in the first 16 months of the CTF
[*]Nearly 30% of parents and relatives and friends are providing for children’s future through additional contributions.
[*]Of those making direct debits to their child’s CTF, weekly contributions outstrip average household spending on personal effects, prams and baby equipment, and a host of other items (source: 2004-5 Food and Expenditure Survey). These families are planning ahead for their children’s futures. [/list]
PIMA is pleased to today announce the release of authoritative statistics on Child Trust Funds (CTF) 16 months on. Through its close work with major CTF providers, PIMA has collected and analysed data in a way that complements the official reports of the HMRC.
PIMA believes that its survey covers over 60% of the market. Summary results from this survey are:
[b]1,392,250 [/b] CTFs have been opened with provider respondents.
Additional contributions can be made to the CTF via monthly direct debits and lump sum contributions.
[b]312,150 [/b] of those CTFs have live monthly direct debits.
[b]£20[/b] is the average monthly direct debit equating to [b]£240 p.a. per account[/b] and totaling nearly £75 million in direct debit contributions per annum
[b]£22,219,062 [/b] has been contributed through one-off, lump sum contributions. The average lump sum contribution to these accounts is £317. (multiple lump sums can be made to a single account provided that they do not exceed the yearly limit of £1200)
This move to collect meaningful data on CTFs is highly consistent with PIMA’s multi-sectoral membership and its well-documented leadership on this issue. This is the latest manifestation of a pilot project PIMA completed for the CTF first birthday held in April 2006 with the Economic Secretary to the Treasury.
[b]PIMA Director General Tony Vine-Lott said,[/b]
‘These results are extremely encouraging. Parents are taking the right steps to save for their children’s future. At a time when there are a lot of demands on families’ resources, it is tremendous to see that in excess of £100 million in additional monies has been saved through the CTF, and this is in only 16 months.’
[b]Responding to why PIMA is undertaking this project, Vine-Lott said,[/b]
‘We are dedicated to produce an accurate picture of the progress and development of CTFs. Too often mixed messages are being put into the marketplace in a way that is not clear for families and the media. As the leading trade body on CTFs, we want to provide statistics that show a clear picture of the long -term savings habits due to CTFs.’
While PIMA believes that these results are very positive, there is still more scope for additional savings by parents and grandparents. While millions of Britons are proactively making additional contributions into CTFs, many still are not. 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 http://www.childtrustfund.gov.uk/.
PIMA intends to publish its survey results on a quarterly basis.
–Ends–
Notes to editors:
1. These numbers are reflective only of the respondents to the PIMA quarterly CTF survey. They are not intended to represent the whole of the CTF market, though PIMA has reason to believe that they are indicative of wider trends on CTF.
2. PIMA invites all CTF providers to participate in its quarterly survey. They can do so by contacting Peter Shipp on 0164 2207 200.
For more information:
Tony Vine-Lott, Director-General, PIMA
077 9000 6108
Iain Anderson or Jacob Coy, Cicero Consulting
020 7665 9535
079 0039 2531