Child Trust Fund common questions

• What is the Child Trust Fund?
• How will I know if my child will receive a Child Trust Fund voucher?
• How do I get the voucher?
• How much can I expect to receive?
• How do I open an account?
• Where will the money be invested?
• When can my child have access to the money?
• How will I know how much the fund is worth?
• Will legal guardians receive the voucher?
• Can I put the voucher into my bank account?
• Can I encash the voucher now?
• Is there a limit to the amount that can be invested in the Child Trust Fund?
• What can my child do with the money?
• Can the money be withdrawn at any time?
• Is there anything else that I should consider?
• What happens if I don't open an account?
• What should I do next?
• How can I get more information?
• Important Information

What is the Child Trust Fund?

The Child Trust Fund is part of a Government initiative to encourage people to give children a better start in life. If you claim Child Benefit for your child, you will automatically be issued with a voucher to open a Child Trust Fund account. The money from the fund could be used towards university costs, vocational training or even a deposit on a home.

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How will I know if my child will receive a Child Trust Fund voucher?

If you are aged 16 or over, have parental responsibility for a child born on or after 1 September 2002 and are eligible for Child Benefit you will receive a voucher, which can be used to open a Child Trust Fund account. This date was chosen by the Government. If you have older children who do not qualify for the Child Trust Fund payment and would like to start a savings account for them, please ask any member of staff for further information.

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How do I get the voucher?

Anyone who is claiming Child Benefit will automatically receive a voucher for each child born on or after 1 September 2002. You do not need to do anything else.

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How much can I expect to receive?

The Government will provide vouchers worth £250 for each eligible child born on or after 1 September 2002. If you receive full Child Tax Credit, the Government will provide an additional £250 for each eligible child.

For each eligible child born between 1 September 2002 and 6 April 2005, the Government will increase the payment.

This is to compensate the child for the fact that there is a shorter period over which to invest the money. The table below shows how much will be paid:

Child Tax Credit payments

When the child reaches the age of seven, the Government intends to provide an extra payment. The actual amount to be paid has yet to be confirmed.

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How do I open an account?

Child Trust Fund accounts are only available from Government-approved suppliers such as NatWest. Accounts can be opened once the voucher is received, and will have money credited to them.

Child Trust Fund application packs are available in our branches or by contacting us on 0845 603 0313*.

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To open a NatWest Child Trust Fund, simply complete the application form contained in the pack and return it, along with the Child Trust Fund voucher, in the reply paid envelope provided.

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Where will the money be invested?

The NatWest Child Trust Fund is designed to provide the child with a cash lump sum when they reach the age of 18. In order to do this, the NatWest Child Trust Fund offers customers a fund that invests in a wide range of assets offering potentially higher returns than a deposit fund.

You should, however, be aware that, unlike a deposit account, the value of the investment in the NatWest Child Trust Fund can fall as well as rise. This is because the value of shares can fall. The value of the Child Trust Fund will therefore vary from year to year and, for example, the value in later years could be less than preceding years in certain market conditions.

The NatWest Child Trust Fund has been designed to make the investment process as simple as possible, enabling you to invest more money when you are able to do so and to keep you informed of how the fund is progressing. The NatWest Child Trust Fund is provided by Royal Bank of Scotland Collective Investment Funds Ltd.

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When can my child have access to the money?

The Government has said that the money must stay in the account until your child reaches 18. Only then, will he or she be able to withdraw the money.

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How will I know how much the fund is worth?

Each year, around your child's birthday, NatWest will provide a statement detailing how much the fund is worth.

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Will legal guardians receive the voucher?

Yes. As long as you have parental responsibility and receive Child Benefit, you can open the account. Special arrangements will be made for children in care.

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Can I put the voucher into my bank account?

No. The Government rules state that you can only invest the voucher into a Child Trust Fund account.

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Can I encash the voucher now?

No. The Government has stated that the voucher must be invested in a Child Trust Fund and cannot be encashed.

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Is there a limit to the amount that can be invested in the Child Trust Fund?

Parents, family, friends and the child can contribute to the account as long as the total of all contributions does not exceed £1,200 a year. The annual £1,200 limit runs from your child's birthday in one year to the day before your child's birthday the next year.

Minimum payments into the account are £10. To generate a reasonable lump sum on the child's 18th birthday you should consider making additional payments to the Child Trust Fund whenever possible. Further information is contained in the Child Trust Fund application pack, available in our branches or by contacting us on 0845 603 0313*.

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What can my child do with the money?

When your child reaches 18, he/she can decide how they wish to use their money - perhaps for university fees or a deposit on a new house. If they choose to continue saving, the money may be transferred to another savings scheme at that time.

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Can the money be withdrawn at any time?

No. The Government has said that the money must stay in the account until your child reaches 18. Only then, will he or she be able to withdraw the money.

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Is there anything else that I should consider?

Saving for children at an early age makes sound financial sense but you should also consider your own financial arrangements and ensure that, with the added responsibility that a young family brings, you have adequate financial protection in place. A meeting with a Financial Planning Manager can ensure that you and your family are protected quickly and easily.

Child Trust Fund application packs are available in our branches or by contacting us on 0845 603 0313*.

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What happens if I don't open an account?

If you do not open an account within 12 months of receiving your voucher, the Inland Revenue will open an account on behalf of your child.

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What should I do next?

When you receive your Child Trust Fund voucher from the Government, please request your NatWest Child Trust Fund application pack. Application packs are available in our branches or by contacting us on 0845 603 0313*.

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How can I get more information?

For further information, please contact us on 0845 603 0313*. Lines are open Monday to Friday 8.30am to 5.30pm, excluding public holidays.

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Important Information

Child Trust Fund accounts can only be opened by the person with parental responsibility who is 16 years or over.

Some information on this page may not apply to the Isle of Man, the Channel Islands or Gibraltar.

The Child Trust Fund is provided by RBS Collective Investment Funds Ltd. Registered in Scotland No SC46694. Registered Office: 24-25 St Andrew Square, Edinburgh Eh5 2YE.

Authorised and regulated by the Financial Services Authority.

Please read the important legal information

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