Child trust fund

[Girraffe1968]

Received this letter today no idea what it means does anybody know please

They move some of the investments to less risky ones I think. Have you looked up lifestyling?

Ah looks like they aren't going to do Lifestyling as it's already in a less risky portfolio

When CTFs were setup a lot of them had ‘life styling’ built in. This basically means they move into lower risk assets as the holder nears age 18. Why? Because you don’t want the portfolio changing in value significantly just before you’re ready to cash in.

If it is worth 10k today and in the next 3 yrs (15-18) the stock market goes up 20% you’d expect it to be worth 12k. If it goes down 20% you’d expect it to be worth 8k. Life styling is supposed to minimise both the upside and downside. You might only get £200 gain if the market goes up but only lose £200 if the market goes down. This is a very simple example and the numbers aren’t necessarily accurate but hopefully it helps you understand what they mean.

I’d suggest if the money will stay invested beyond age 18 (ie switched into an adult ISA) then keep it in higher risk assets. If you think the money is needed at 18 then de risking now is probably ok.

Worth switch it to a JISA anyway. Fees probably much lower

Ds's trust fund has devalued a lot in the last year. He's now 18. I know this is happened to many people and it is all over the Internet I'm wondering what the best thing to do now is. It was fine fir most of the years, I got regular statements, but now it's devalued in the last year.