CTF discussion area

davidjwest

This is actually the Homeowners Friendly Society CTF, ASDA are simply acting as a go between for them.

The extra £15 voucher is better than nothing of course, tough to say whether or not shares are going to outperform the current savings rates offered by other CTFs when you take charges into account.

If you think shares are going to rise by more than 7.5% a year then it's worth it, but nobody on this planet can answer that question with 100% honesty and reliability.

However over the 18 year life of a CTF, shares will almost certainly do better than savings, if history is anything to go by, although the charge of 1.5% will make it fairly close.

Welcome to the wonderful world of CTFs!

superfurry

I downloaded a Britannia CTF application form PDF. It's asking me for a password, can anyone help ?

Update: It works when you click on the file to open it, but doesn't if you save to PC, then open !

Kallisti

Try again? Worked fine for me the other day.

colinm

I've been reading this discussion on CTF's with great interest, as I too am really struggling to decide which is best to go for - savings or investment - and with which provider :eek:

At the moment, I'm fairly sure I'm going to invest with Brittania, as they also offer membership loyalty points - don't know how much they will add to the value, but better than nothing! However, I haven't received my voucher yet, so may change my mind again

superfurry

Posted my Britannia applications today ( i have 2) - The 6% interest period is only for accounts opened before 6th April as I read it. I will not be investing any more cash into this, and i'll probably jump ship to the best provider at the time when the 6% period ends.

cloud_dog

colinm wrote:

I've been reading this discussion on CTF's with great interest, as I too am really struggling to decide which is best to go for - savings or investment - and with which provider :eek:

At the moment, I'm fairly sure I'm going to invest with Brittania, as they also offer membership loyalty points - don't know how much they will add to the value, but better than nothing! However, I haven't received my voucher yet, so may change my mind again

I think one of the things you need to decide on is whether you are going to add contributions to the fund, how much, and what frequency.

For my part I will invest in stocks/shares fund. Have changed my original view of using Comdirect (too much charges involved) and am looking at Family Investments (am waiting for the finer details in the literature) as the fund is invested with New Star (fund manager I have a lot of respect for) but need to know which fund(s) and minimum monthly contributions, etc.

If you look at my post (near the top of page 9, I think) there is a link to a review carried out by the Financial Mail (Sunday Mail) and it offers suggestions for cash, stocks/shares, or stakeholder, it also offers views on ones to avoid.

cloud_dog

Quaver_2

Hi all. I am newly registered with mse and have followed the ctf thread with interest. Like others I have decided to go for a Brittania non stakeholder, attracted by the 6% plus the possibility of membership loyalty. Apparently the deadline for signing up for this is not the 6th April as mentioned in some articles so dont feel you have missed the boat if this is your first choice.

My partner already invests approx £900 a year in a maxi stocks and shares ISA which is a long term investment for our daughter (who is 18 months old). The idea being this would go towards university/housing costs when she reaches 18. We therefore felt we didn't want to invest more cash in shares due to the potential risk it carries and also the fact we are relative novices in the fiscal world (but learning quickly thanks to Martin and contributors to mse forum!!!)

Kallisti

Quaver, don't forget that your child will have control over the CTF money when they turn 18. I'm not so sure an 18 year old sees that housing costs are a great way of spending a windfall cash sum so it might not be wise to treat the CTF money in the same way as the other investments you make on her behalf.

FWIW, I too plumped for the Britannia. I was almost scared off by the original deadline of the 6th of april 2005 as I'm now due a second voucher for my son who was born on the 31st of March (and didn't want to have each voucher with a different provider). However, either it was mis-read by half the country or they've changed it to the 6th of april 2006!

As far as I can see they're the only ones that hit 6% with no significant strings attached.

Starsky_4

Hi - I'm about to set up a Childrens Investment Plan alongside the Child Trust Fund, both with Foreign and Colonial. I will make sure the investment plan is treated as a bare trust by filling in the appropraite forms, however I am confused by the tax situation of the plan (not the CTF). The Key Features state

"Alternatively, you can designate the investment for the child and at
the same time, set up a bare trust. This means that the investments
held within the trust are treated as the child’s for tax purposes. Any
capital gains and income are taxed as the child’s.

All income that is generated from gifts by people other than the
child’s parents (for example, grandparents) is treated as the child’s.
If the child’s total income does not exceed £4,895 there is no
further tax to pay. However, this is not the case for income deriving
from gifts from the child’s parents. If the income is more than £100
gross in any financial year, all the income will be taxed as the
parents’ and will be taxed at the parents’ highest rate."

This seems to say in a bare trust there are no tax implications for parents, yet it then says if income is >£100 then parents are liable for tax. I am a high rate tax payer, my wife a non-tax payer, so I don't want to end up paying 40% of the income from the plan in tax..

Any explanation/advice/clarification would be most welcome.

colinm

Starsky wrote:

This seems to say in a bare trust there are no tax implications for parents, yet it then says if income is >£100 then parents are liable for tax. I am a high rate tax payer, my wife a non-tax payer, so I don't want to end up paying 40% of the income from the plan in tax..

Any explanation/advice/clarification would be most welcome.

I think the situation is that if you as either parent pay in money to a child's account, the account must not accrue more than £100 in interest from either of your money per year, otherwise it will be taxed at your tax rate. This is to stop parents from hiving their money into a high interest account under the child's name, and getting all the tax free income. So you're ok to pay in up to around £1660 per year into an account that pays 6% interest.

If any other person pays into the account (eg. grandparent) then the £100 rule doesn't apply, but the child still has a personal income limit of £4745.

Hope this helps!