Child Trust Fund

[tegan]

I have just received my ctf for my 8 wk old baby and am really confused as to where to put it. I really need some advice as i don't have a clue about savings or shares.

As much as the shares go up they can crash down just as quick and the way businesses are ATM I wouldn't invest you are not guaranteed anything back.

I put my DS's CTF in Nationwide as they had the highest interest rate at the time that was in 2006 but I've never had a problem with them.

I prefix this with I have NO financial experience.

The state of the stock market is dire atm but from my (very uniformed) perspective over the next 18 years it is more likely to go up than down, although it may not return to previuos levels. It depends on how much security you want.

I veiwed the CTF voucher as free money as thus took the risk (with an overseas fund) you may just want the assurance of getting the same money out that you invested (savings rates are rubbish atm but may improve.

FWIW as people are not talking about depression as much as recession things are ulikely to recover in the short term.

I opened an account for DD and DS at Children's Mutual as they do ethical shares/accounts which was important to me.

Having said that, I would choose an account that was easy to access; for instance, how will you pay money into the account? By DD or will you also put money into the account by cash/cheque. If so, then you may want a High Street Account.

Think the cheque comes with a leaflet about the various accounts and providers?

Watching. I need to sort out ds2's.

cheque came with a guide that tells you all the providers divided into three categories but to be honest its not very clear. the website

www.childtrustfund.gov.uk

is actually very good and should help you out a bit. but at the end of day you have to make the decision regarding how much risk you would like to take - eg cash or shares and again how risky a share investment you would like to make.

I went for the high risk option, as I felt that over 18 years the risk was OK.
If I was investing a voucher at the moment I would still do the same.

I dont put anything extra into the CTF account, we save separatly for the children. The CTF is organised in such a way that children take control of it when they turn 18. I hope that when my children hit 18 they are sensible and financially prudent, but just in case they arent, I'm not giving them access to everything I have saved for them on the day of thier 18th birthday!

Over 18 years, shares are very likely to outperform cash by a significant amount.

Shares are very low at the moment. The recession has already been factored into the prices. Rothschild said that 'the time to buy is when blood is running in the streets'. I think that time would be now.

You could buy a tracker fund that tracks the FTSE Allshare.

I have a moderate appetite for risk. Depends on what you are comfortable with.

I ummed and erred about this for ages, eventually I decided that this was essentially 'free' money that we wouldn't have otherwise had and therefore to take more of a risk with it than i am usually comfortable with. Also over 18 years the stock market is likely to outperform savings.

Went for F&C shares option, looked at stakeholders but the charges on these were actually higher than the non stakeholder fund I chose. Am not adding any extra money as we will save separately for dd.

I should add that i am no expert on these things just did a bit of internet research and weighed up what risks i was willing to take

frogmarsh, how very strange. I seem to have gone down the exact same thought process as you - even noting that the charges for stakeholder funds, some of which only purport to track an index, were right at the maximum for what they were allowed to charge.

I too settled on a low-cost F&C fund - the investment trust that is huge and has been around for ages.

I've never liked shares, that's our only reason for not investing that way, I was tempted though to give it a go as it's "free" money. Though I think they are likely to outperform a savings account.

But like tigger, we are saving seperately and not adding to the fund, for the same reasons.

slight hijack (sorry!)my DC is due in 12 days and I can't remember whether you actually have to apply for it or whether they send you the CTC cheque once you've applied for child benefit?

They send you the cheque ( even then I still manegd to lose mine in a house move[blush)

we also have F&C in an overseas fund (far east emerging markets type thing) and again have added but only a very small amount due to the fact that the child WILL take control at 18.

They send you the cheque ( even then I still manegd to lose mine in a house move[blush)

we also have F&C in an overseas fund (far east emerging markets type thing) and again have added but only a very small amount due to the fact that the child WILL take control at 18.

interesting! we have a stakeholders account with childrens mutual, paying into monthly, reckon that stocks are low right now so get more for money to build portfolio and over the next 16 years shares will likely to go up. please tell me if otherwise anyone???!