Cash CTFs still favoured

CASH CTFS STILL FAVOURED

Cash based Child Trust Funds (CTF) continue to be favoured by parents according to new data from the Building Societies Association (BSA).

The BSA figures suggest that 69 per cent of those investing in CTFs in August opted for cash based versions where other options were offered.

This means that the 11 providers who offer cash CTFs now account for more than 25 per cent of the market.

"Where vouchers have been invested, over a quarter of parents have chosen the safety and security of the cash option," said BSA's head of savings policy Brian Morris.

Over £65 million is currently held in cash CTFs, with 230,000 of the schemes being opened since the launch.

The study also revealed that half of the vouchers sent out to parents were still to be invested in any CTF.

Research earlier this month suggested that many parents are failing to benefit from CTFs due to confusion over the investment options. At the time it was estimated that £288 million had been lost in potential savings.

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