Scottish Friendly is an approved provider of the Child Trust Fund . The Government is keen for the public at large to have access to Stakeholder accounts and this is the type of account that we are supplying. This means that:
• Investments are saved into our Managed Growth Fund, which aims to provide strong growth potential.
• It invests in part in shares to make the mosyt of potentially higher returns over 18 years,compared to a cash deposit account (although the value of shares can decrease as well as go increase whereas capital would be protected in a deposit account).
• It is available with a low ‘Stakeholder’ funds charge of only 1.5% per year
• When reaching 18 the young person will get a lump sum, wholly free of Capital Gains and Income Tax under current law
• It is affordable - additional payments can be put in the account from just £10
Anyone - parents, grandparents, aunts and uncles, friends - can contribute an uppermost limit of £1,200 per year to the Fund (once added, this money may not be withdrawn).
All this means that our Stakeholder account offers a good balance between possible high returns and a reduced level of risk. There is also the assurance that our account meets the Government’s stakeholder criteria. Nonetheless this doesn’t mean that returns are assured or that Stakeholder accounts are appropriate for everyone. Remember that the value of shares in the Managed Growth Fund (where your Child Trust Fund money is invested) can fall as well as go up and is not guaranteed.
Only children whose birthday falls on or after 1st September 2002 are eligible to open a Child Trust Fund. If you have older kids who are not qualified you could think about investing for them with a Child Bond - it’s a tax-free savings plan intended for long-term growth.