HMRC is writing to 21-year-olds as part of a Child Trust Fund awareness drive aimed at reconnecting young adults with money they may not know they have. The tax authority says the accounts often hold about £2, 200 on average, and the letters are being sent in stages from now in Eastern Time terms as the campaign gets under way. The focus is on unclaimed accounts held by banks, building societies, and other savings providers rather than by the government.
HMRC targets 21-year-olds first in Child Trust Fund push
The Child Trust Fund campaign is designed to reach young people whose accounts have matured but remain unclaimed. HMRC is using the 21-year-old age group because many people by then will have been in work or used student finance, which makes their contact details more likely to be current.
The accounts were set up for children born between September 2002 and January 2011. When the scheme began, many children received around £250 from the government, with some from low-income families or in local authority care receiving an additional £250. Parents could add up to £9, 000 a year, and if no account was opened within 12 months of birth, HMRC opened one on the child’s behalf.
Child Trust Fund balances and how the money is held
The average balance is put at £2, 200, and the scale of the issue remains large. More than 750, 000 Child Trust Fund accounts are still unclaimed, while today two-thirds of the more than 6 million recipients are over 18 and already entitled to access their money.
The money is not held by HMRC. It sits with savings providers, and once an account holder turns 18, the fund matures and the owner can choose whether to withdraw the cash or reinvest it. That makes the current contact drive important for people who may have lost track of where their savings were placed.
Lucy Rigby, the City minister and economic secretary to the Treasury, said: “Hundreds of thousands of young people in this country don’t know they have a CTF, let alone how to access it. Some will have a couple of thousand pounds sat there that would really help them as they begin adult life. ”
What young savers can do now
Young people can track down their account using the government’s free online tool. If they already know which bank, building society, or savings firm holds the account, they can contact that provider directly and ask for help reclaiming the funds.
The Share Foundation, a charity that helps people search for accounts, is also involved and has called for HMRC-allocated accounts to be automatically released when holders turn 21. HMRC is now writing to all 21-year-olds with unclaimed accounts, and the campaign is expected to reach many thousands of young people.
Why this Child Trust Fund drive matters now
This latest push comes after years in which many accounts have stayed untouched simply because the young adult does not know the money exists or where it is held. The scale of the unclaimed total has kept the issue in focus, especially as the first recipients have moved into adulthood.
As the Child Trust Fund letters continue to go out, the key next step is whether more young people act quickly to identify their provider and claim what is theirs before another account is left sitting forgotten.
