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Saving for children: a survey of the Child Trust Fund

Press release issued: 21 September 2006

Children's savings and investments are the subject of a new report by researchers at Bristol University, published today by HM Revenue and Customs (HMRC).

Saving for children is the subject of a new report by researchers at Bristol University, published today by HM Revenue and Customs (HMRC).

The research provides information on the extent and nature of saving for and by dependent children prior to the introduction of the Child Trust Fund, and also looks at parents’ views about and intentions regarding the Child Trust Fund, together with an early assessment of the Child Trust Fund market.

The Child Trust Fund is a savings and investment account for children, introduced by the government in April 2005.  Children born on or after 1 September 2002 receive a £250 voucher to start their account. The account belongs to the child and can't be touched until they turn 18, so that children have some money behind them to start their adult life.

The researchers found that around seven in ten of all dependent children aged up to 18 had some form of savings or investments and most children had their first account opened either at birth or before they reached the age of one. 

A little under half of all dependent children had had money paid into savings or investments in the past year; the average amounts saved for them were £180 – most of which was deposited by parents. 

More than 1.6 million Child Trust Fund accounts had been opened in the 12 months to 5 April 2006.  At the time they were receiving their vouchers, the majority of parents said that they intended to add further money to the accounts themselves in the coming year.  Industry figures, which are also published today, show that many have saved into their Child Trust Fund accounts.

Professor Elaine Kempson of Bristol University’s Personal Finance Research Centre, who carried out the research, said: “The research provides us with a detailed picture of levels of saving and investment both for children and by children and young people themselves which will enable us to assess the impact that the Child Trust Fund has on saving for and by children.”

“Early indications are encouraging, not only will the Child Trust Fund ensure that more children have some form of savings or investment but also that a larger proportion of parents are themselves putting money away for their child’s future."

The report, Saving for children: A baseline survey at the inception of the Child Trust Fund was written by Elaine Kempson, Adele Atkinson and Sharon Collard.

The report is available to download via the HMRC website, or for more information on the study, please visit

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