Child Trust Fund - Your questions answered
Will my child be eligible?
How is the Plan opened?
How can
subscriptions be paid?
Can monthly
subscriptions be increased?
Can monthly
subscriptions be reduced or stopped?
How will I
keep track of the value of the Plan?
Can money be
withdrawn from the Plan?
Is there a
death benefit?
What are the
charges?
How do
stakeholder accounts differ?
What is the tax
situation on the CTF account?
Does my
child’s Plan have to be lifestyled?
Can Child
Trust Fund Accounts be transferred?
Will my child be eligible?
Child Trust Fund packs, including the Government
voucher, are automatically sent to all people claiming child
benefit for children that qualify.
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How is the Plan opened?
The Plan has to be opened with the Government voucher by someone
with parental responsibility for the child.
Normally this will be a parent who will then be responsible for
managing the Plan until the child reaches age 16.
You can Download an Application
Form to open a CTF account.
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How can subscriptions be paid?
Single subscriptions can be made by cheque or direct credit.
Regular subscriptions are collected monthly by direct debit or
standing order from each subscriber. The minimum subscription is
£10.
Subscriptions will be accepted in date order up to the maximum
subscription limit.
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Can monthly subscriptions be
increased?
Each year we will automatically increase the amounts received from
each monthly subscriber to help the Plan keep pace with
inflation.
Additional monthly increases from £5 upwards can be made at any
time subject to the subscription limit.
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Can monthly subscriptions be reduced or
stopped?
Yes. Any monthly subscriber can stop paying or reduce their monthly
subscriptions at any time. Reductions are subject to a minimum of
£5 and a minimum ongoing subscription of £10.
If any subscriber wishes to stop automatic increases to their
subscriptions they should tell us at least 14 days before the
increase is due.
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How will I keep track of the value of the
Plan?
Every year we will send you a statement showing the payments
received, the number of units held and the value of your child's
Plan.
You can view current unit prices on our
website or by calling our Unit Price Information Line free on 0800
990 011.
You should monitor the value of the plan and the level of
subscriptions paid.
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Can money be withdrawn from the Plan?
No. All savings are locked in until your child’s 18th birthday.
At that age the accumulated fund will be payable as a cash lump to
your child allowing them to spend or reinvest it as they wish.
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Is there a death benefit?
Yes. In the event that your child dies before age 18 we will pay
out 101% of the value of units to the child’s legal personal
representatives.
In exceptional circumstances payment may also be made in the event
of your child suffering a terminal illness.
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What are the charges?
Foresters Child Trust Fund is a stakeholder account and as such
meets the Government standard for ‘capped’ charges.
There is an annual charge of 1.5% of the value of the funds you
accumulate.
If your fund is valued at £250 throughout the year, this means that
we deduct £3.75 that year.
If your fund is valued at £500 throughout the year, this means that
we deduct £7.50 that year.
There are no initial or exit charges.
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How do stakeholder accounts differ?
Child Trust Funds can be stakeholder or non-stakeholder but only
one type can be held at any time.
Stakeholder accounts must satisfy Government standards for minimum
subscriptions from £10, a range of payment methods and charges of
no more than 1.5% p.a of fund.
Scheme investments must be suitable and take into account the need
for diversification with lifestyling to progressively reduce the
investment risk as the Plan approaches maturity.
Accounts that meet stakeholder conditions are not necessarily
suitable investments for a customer, nor do they offer any
guarantee of performance.
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What is the the tax situation on the
CTF account?
Growth within the account is completely free of income
and capital gains tax, except for dividents from UK shares.
At age 18 the proceeds are payable to your child as a
tax free lump sum.
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Does my child’s Plan have to be
lifestyled?
No. We will write to tell you when lifestyling is due to commence
which will normally be from your child’s 13th birthday.
At that time your options are for the Plan to be
lifestyled or to continue to be fully invested in the Stakeholder
Managed Fund.
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Can Child Trust Fund Accounts be
transferred?
Yes, the Child Trust Fund rules allow you to switch between
providers free of charge.
For more information about how to transfer, please speak to your
local adviser or contact our Customer Services Team on 08457
990011.
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