How to find and transfer a child trust fund (CTF)

Switch your CTF into a Junior Isa in 10 easy steps

1. First work out if your child was eligible for a child trust fund. Six million were handed out to children born between 1 September 2002 and 1 January 2011 before the scheme was scrapped.

2. The handouts took the form of vouchers worth between £50 and £1,000 (it changed over time and was means-tested). These could then be invested in cash or the stock market via the CTF account. Try to find the original paperwork.

3. If the original paperwork is lost, don’t pay someone to find your missing CTF. You can do that for free via HMRC’s website tool here. You will however need a Government Gateway ID number. This is the code you use to fill in self-assessment tax returns. If you don’t have one, you can get one using your national insurance number and other forms of ID.

4. As the CTF is now obsolete, few providers offer it. Subsequently fees can be high and choice of investment limited. Many parents have therefore chosen to transfer their CTF into its successor, a Junior Individual Savings Account (Jisa).

5. The Jisa is broadly similar to the CTF – just without the free cash. Parents, friends and relatives can contribute money up to a certain limit every tax year. Your child can manage the CTF from 16 but he or she cannot withdraw the money until the age of 18.

6. Transferring is easy but you must first decide if you want the money to be saved in cash or invested in the stock market. For a young child, there’s a long investment period and shares could be preferable as they can make a better return in the long term. For a child approaching 16 or 18, cash may be more appropriate.

7. Find the best-paying Jisa cash accounts by searching online. For shares, the easiest and cheapest way to invest is via an online platform. SMM likes AJ Bell, Fidelity, Hargreaves Lansdown and Interactive Investor. See our beginner’s guide to investing here.

8. Select the firm which you would like to be your Jisa manager and check they accept CTF transfers. Ask for their transfer pack, fill in the form with the details of your existing CTF and they will do the rest.

9. You must transfer the full amount so the CTF can be closed. You cannot hold both a CTF and a Jisa.

10. Transfers can take time so allow a good few weeks for the paperwork to be sorted.

 

More stuff:

  • Get full details of the process at MoneySuperMarket
  • Hargreaves Lansdown has a useful guide to transferring here
  • See the best Junior Isa savings rates at Moneyfacts

 

Last updated 5 September 2018.