Young people urged to claim their Child Trust Fund
£2,200 on average waiting in unclaimed accounts
More than 670,000 18-22 year olds yet to claim their Child Trust Fund are reminded to cash in their stash as HM Revenue and Customs (HMRC) reveals the average savings pot is worth £2,212.
Child Trust Funds are long term, tax-free savings accounts which were set up, with the government depositing £250, for every child born between 1 September 2002 and 2 January 2011. Young people can take control of their Child Trust Fund at 16 and withdraw funds when they turn 18 and the account matures.
The savings are not held by government but are held in banks, building societies or other saving providers. The money stays in the account until it’s withdrawn or re-invested.
If teenagers or their parents and guardians already know who their Child Trust Fund provider is, they can contact them directly. If they do not know where their account is, they can use the online tool on GOV.UK to find out their Child Trust Fund provider. Young people will need their National Insurance number – which can be found easily using the HMRC App – and their date of birth to access the information.
Angela MacDonald, HMRC’s Second Permanent Secretary and Deputy Chief Executive, said: “Thousands of Child Trust Fund accounts are sitting unclaimed – we want to reunite young people with their money and we’re making the process as simple as possible.
“You don’t need to pay anyone to find your Child Trust Fund for you, locate yours today by searching ‘find your Child Trust Fund’ on GOV.UK.”
Third-party agents are advertising their services offering to search for Child Trust Funds and agents will always charge – with one charging up to £350 or 25% of the value of the savings account.
Using an agent can significantly reduce the amount received; is likely to take longer and customers still need to supply them with the same information they need to do the search themselves.
Gavin Oldham from The Share Foundation said: “If you are 18-21 years old, the government would have put money aside for you shortly after birth.
“This investment would have grown quite a bit and it’s in your name. The Share Foundation has linked over 65,000 young people to their Child Trust Fund accounts. It’s easy and free to find out where your money is.
In the last year more than 450,000 customers, with just their National Insurance number and date of birth, used the free GOV.UK tool to locate their Child Trust Fund.
More information on Child Trust Funds and how to access your savings can be found on GOV.UK.
Nearly 4 in 10 say they wouldn’t ask for financial help if they were in trouble due to embarrassment
81% say they feel anxious about their financial situation
44% say they feel more worried about their financial situation now, compared to a year ago
New research has revealed that those in Scotland are the most at risk of financial turmoil due to embarrassment about their financial situation.
The findings, which were part of a UK-wide study by financial comparison website, NerdWallet UK, found that those in Scotland – alongside those in the South West – are the most likely to not seek help should they find themselves in financial difficulty due to the embarrassment around the topic.
Almost two-fifths of those surveyed said that embarrassment would stop them from seeking help, while just under one-third would be concerned about the impact doing so would have on their credit history, as well as worries around confidentiality. The same number also believe they can manage on their own and do not need external help.
Other reasons which would stop Scots from getting help include, the cost of getting financial advice (29%), and worryingly, just over a quarter said they were not aware of any organisations to help them with debt, or how to contact them.
If I was struggling financially, the following would stop me from asking for help – Scotland:
Reason
Percentage who agreed
I would feel embarrassed
37%
I’m worried about the impact on my credit history
31%
I’m worried about confidentiality
31%
I think I can manage on my own
31%
I don’t want to pay for advice
29%
I don’t think my financial situation is serious enough
28%
I’m not aware of the debt help organisations or how to contact them
26%
I don’t want to speak about my problems on the phone
23%
This is despite 81% of Scots saying they feel anxious about their financial situation, and 25% saying these feelings are daily occurrences.
Furthermore, 44% of respondents in Scotland say they feel more worried about their financial situation now, than they did a year ago.
When asked who they would go to or help first, almost half (48%) said they would speak to their partner or close family member, while 12% said they would speak to a friend.
Adam French, senior editor at NerdWallet UK, said, “It’s worrying that so many Scots would not get help due to embarrassment. Struggling financially is never something to be embarrassed about, and if the cost of living crisis has taught us anything over the last 18 months, it’s that financial trouble can happen to any of us, at any time.
“Getting help when you first find yourself in financial difficulty, and not burying your head in the sand can help to relieve a lot of stress and anxiety around money, and find a way out before things get worse.
“There are plenty of independent experts and companies available to speak to, for free, including Granton Information Centre, the Citizen’s Advice Bureau and Step Change. Everything is confidential, and discussing concerns will not impact your credit score.”
For information on NerdWallet, and to view the full dataset, visit:
Relaxed restrictions in Scotland offer the chance to make the most of many of the much-missed activities that the pandemic put a stop to, from concerts to theatre trips and holidays abroad. But before you splurge on some much-missed activities, consumer finance expert PAUL WILSON explains ways you could get your finances in order first.
With over 20 years experience in consumer finance, Paul has highlighted common pitfalls that consumers often fall into and the simple ways that consumers can get their finances in check whilst still making the most of the summer.
“Many Scots will be excited to make the most of the things that they’ve missed out on in the past year, from concert tickets to holidays abroad. But, whilst there’s temptation to splurge and ‘go all out’ this summer to make the most of the relaxed restrictions, it’s important to make sure that spending doesn’t get out of control.
“Having worked in the finance industry for 20 years, some of the most common money management mistakes I see people make are not actively monitoring and striving to improve their credit score, not setting and sticking to a monthly budget and spending beyond their means on what often turns out to be frivolous.
“As things open up more, it’s important for consumers to enjoy their money, without falling back into bad habits they may have broken in lockdown. There are simple tricks and spending behaviours that can be adopted to make sure people keep their finances in check.”
Cancel those unused, or under utilised, subscriptions
“For many of us, TV and entertainment subscriptions were an essential part of getting through lockdown. But as restrictions lift and it’s easier to do more of the activities that used to fill your time, you may find that some subscriptions go unused.”
“Check your subscriptions. It’s easy to sign up for a new subscription service – particularly when many companies offer free trial periods or low cost sign up offers – and then forget to cancel it. Or perhaps you have a number of subscriptions that you do use, but you could ask yourself how essential they really are. If you can live without it then you could save money by cancelling the subscription or choosing a cheaper alternative.”
Update your utilities providers
“The summer months are a great time to review your insurance and utilities providers. As things open up more, life admin tasks like this can fall by the wayside, so set aside some time to check your spending and see if you can get a better deal.”
“Shop around for all of your insurance and utilities. Generally speaking, loyalty doesn’t pay when it comes to products such as insurance, energy, broadband and TV, and there are usually cheaper deals for an equivalent product out there. So when it comes time to renew one of these products, don’t just accept the renewal price – use a price comparison service to check for the best deals available.”
Budget for your new lifestyle
“As tempting as it is to splurge this summer, make sure you properly budget all of your new spends, from setting aside a budget for going out and leisure activities to factoring in how much you want to spend on drinks at the pub or online shopping.”
“Calculate how much you have coming in each month and how much your essential financial commitments are (e.g. mortgage/rent, transport costs etc.) and therefore what you can afford to put away into savings and what your disposable income is. Once you have your budget – stick to it! Post it up somewhere in your house where you will regularly see it or set reminders on your phone to prompt you to check how you are tracking against your budget.”
Get on top of the weekly food shop
“For many of us, staying at home more often in lockdown meant spending more money on food and treats. So, the relaxing of restrictions is a great time to get on top of your food bill.”
“Save money on your weekly food shop by planning a menu and a shopping list to ensure you only purchase the items you need. Embrace batch cooking and freeze portions to be eaten at a later date – this may help avoid being tempted to use costly food delivery services when you haven’t got anything in for dinner. Consider choosing one of the budget supermarkets such as Aldi or Lidl for the bulk of your shop and downshift from brand name items to own-brand.”
Spend savvy
“With more people getting out and about and making the most of the summer, there’s more incentive to buy new things, from new holiday clothes to treating yourself to see a band you haven’t been able to see live since 2019. So, if you’re planning on treating yourself, try using comparison sites that offer savings incentives in order to get your money to go further.”
“There are a number of ways you can save money when you are purchasing online. Firstly there are cashback sites that offer money back in your pocket when you purchase via a special tracked link – it costs you nothing extra, takes just seconds longer, and if you were going to buy the product anyway it’s a no brainer. Secondly there are browser extensions and apps you can use to hunt out bargains. For example, InvisibleHand is a chrome extension that runs in the background of your browser and automatically notifies you if it can find the product you are shopping for at a lower price on another site. Similarly, Honey is an extension that automatically finds and applies discount codes at the checkout when you shop online.”
Think about your credit options for big purchases
“It’s great to see the travel corridor opening up and more countries being added to the green list so that everyone can get a much-needed summer holiday. But as tempting as it is to go away, it is important to properly review your finances before committing to a summer holiday.”
“Save up for big purchases wherever possible rather than putting them on credit. Taking the time to save the money can give you time to evaluate if the purchase is really something you want or need. If you have the cash up front it will save you money on paying any interest and avoids any potential damage to your credit score through missed repayments. And remember, it’s tempting to pay for the holiday of a lifetime on a credit card, but then you’ll be paying for that holiday many years after you’ve come back.”
Track your spending
“It can be very easy to lose sight of how you are spending your money so use a money tracking app linked to your bank account to ensure you keep track of every pound leaving your account.”
“Many money-tracking apps let you categorise spending and easily set budgets for different categories, such as shopping, eating out and groceries. This allows you to properly keep track of your personal finances and stick to your budget, as helpful notifications will let you know when you’re close to your budget for each category.”
Put savings away
“Don’t let the excitement of relaxed restrictions stop you from putting money away for a rainy day. Try to put a small amount away as soon as you get paid, or try saving a few pounds a week to kick-start your savings pot.”
“If you do have any left over cash at the end of the month, put it in a savings account and try to build up an emergency fund. As a general rule, you should ideally have 3 months worth of critical expenditure (rent, food, bills etc) in your savings account to deal with unforeseen circumstances such as a redundancy or replacing an essential appliance.”
Save on travel to work
“One of the best things that came out of the pandemic is the uptake of cycling, with millions of Brits getting on their bikes to enjoy exercise and space outside in lockdown. Whilst some offices are inviting staff back to work in the office, a blended approach of remote and office-based working has been adopted by many businesses, which takes the pressure out of travelling in peak commuting times.”
“If you can sacrifice the convenience factor, you can save some significant money on fuel and parking by ditching the car and walking or cycling whenever possible. For example, could you walk or cycle to work? Even if it’s just one or two days per week or even just when the weather permits, the money saved can quickly add up.”
“If I were to choose one of these tips as the most important, I would say that the additional benefits of walking or cycling – both in terms of the benefits to an individual’s health but also to the environment – make ditching the car more frequently the most important tip.”
Paul Wilson is a consumer finance expert at Financial Conduct Authority authorised and regulated credit broker Little Loans.
