Young adults may have thousands of pounds waiting to be claimed

A huge number of young adults are missing out on money in unclaimed child trust funds (CTFs).

According to HMRC, about 827,000 young adults have a matured CTF waiting to be claimed, worth more than £2,000 on average.

But the government is concerned that many young people might not know about this money and is encouraging them to check.

What are child trust funds?

CTFs are long-term tax-free savings accounts for children born between 1 September 2002 and 2 January 2011.

The idea was that these pots of money would increase in value over subsequent years and could then be claimed once the child turned 18.

The government initially contributed £250 to each account, with children from low-income families or those in local authority care receiving an extra £250. 

Parents, guardians and other family members could also pay up to £9,000 a year into their child’s account. 

But even without additional payments, most funds are worth much more than when they were set up, because of interest.

How do I track down a child trust fund?

If you don’t know where the account was originally opened, then your parents or guardians might know.

Alternatively, get in touch with HMRC.

If you already know who the account is with, contact the CTF provider directly.

“The oldest matured child trust fund accounts are now more than six years old and some young people may not know they have savings waiting for them,” said economic secretary to the Treasury Lucy Rigby.

Young people ‘quids in’ after claiming money

Since September 2020, nearly 3m matured CTF accounts held by 18 to 24-year-olds have either been claimed or transferred into an individual savings account.

And in HMRC’s words, these people are “quids in”.

Anna, 18, is among those who’ve claimed her CTF and found the process very straightforward.

“I’m heading off to university soon, and I honestly had no idea how expensive things like saucepans, plates and all the other essentials would be, so this support has been really helpful” she said.

Matteo, another 18-year-old, added: “I’m looking at all my options before deciding what to do with my child trust fund. 

“My parents have topped it up over the years, so it’s grown into a really useful amount of money.

“I don’t want to rush into anything or waste it, so I’m taking the time to work out what’s best for me.”