Child Trust Fund Accounts - Sold Down The River?

Reaper

neet wrote: »

Have you just got an F&C letter about fee increae - for those of us who never topped up the CTF - preferring bare trust - this amounts to a confiscation of the entire sum

The F&C charges issue has got spread across 3 threads, but you could try my suggestion in the others on how to dodge the fee:
http://forums.moneysavingexpert.com/showpost.php?p=59222945&postcount=208

neet

I shall have a look at your suggestion. Meanwhile I had a few moments spare and despite the piffling amount I decided to complain by letter. The basis of the complaint is that the fee is unfair in the context. The standard contract, and specifically the term that that allows virtually all the financial world to put up its fees without negotiation makes them subject to the unfair contracts act and should bring them within the remit of the FSA and OFT. My contention is that the term has to be looked at in the context of the scheme. It was a government driven initiative, effectively incorporating an implied warranty of reasonableness specific to the smaller investor and that the term is confiscatory of the return premium, which must be unreasonable. Furthermore the firm would have known that some accounts would be topped up and others not - they took this risk because the overall FUM growth would make it worthwhile - they cant renage on that deal now that they have been dealt some small cards. Would be pleased if others complain - if enough do it may make the Board sit up and take note - see for example SAntander climb down on Free Forever account fees.

Tammer

I am also going to complain to F&C. 3 areas - Unfair Contract Terms, and 2 failures to meet TCF outcomes.

The_big1

foolsgold99 wrote: »

Hi,
When my first son was born in 2010. We got a £50 child trust fund voucher. Trying to be responsible parents we deposited the full amount (currently £1310.59) into the account believing that it was backed by the Government. We put it into the Yorkshire Building Society only to find a year later that the Government have scrapped the scheme and as a result the banks have lost interest in the trust fund accounts. The result being that my son's money is now trapped in that account until he is 18 earning a poor interest rate.

The fact that the banks have lost interest also means that rates on their accounts are all poor so there's not even much point in switching.

I think that having decided to scrap the scheme we should be allowed to withdraw the funds and close the accounts.

Another well thought out Government plan :mad:

Do not keep CTF's in cash, cash is going down every time the pound sterling currency supply gets expanded by another 50billion out of thin air. They are doing these currency debasements more frequently these days.

Why not put your CTFs into something other than cash, like an ETF. Careful some ETFs are not backed by real things, some are.

xylophone

No banks are interested in CTF now and our children's money is stuck in there.

Transfer elsewhere? https://www.gov.uk/child-trust-funds/overview
http://www.furnessbs.co.uk/saving-accounts/young-savers/child-trust-fund/ They also offer link to Family Investments stakeholder.

Reaper

The_big1 wrote: »

Why not put your CTFs into something other than cash, like an ETF. Careful some ETFs are not backed by real things, some are.

I think you will struggle to find any CTF providers that allow ETF purchases, and which allow transfers in.

cloud_dog

foolsgold99 wrote: »

It's ridiculous. They really have fleeced us. No banks are interested in CTF now and our children's money is stuck in there. :mad:

Just switch it to a better provider?

YBS is still offering 3% which is in line with normal account rates.

xylophone

YBS is still offering 3% which is in line with normal account rates.

But with bonus which drops off after 12 months?http://www.moneysavingexpert.com/savings/child-trust-fund-vouchers

cloud_dog

xylophone wrote: »

But with bonus which drops off after 12 months?http://www.moneysavingexpert.com/savings/child-trust-fund-vouchers

Yes but....... who said life was easy.