Child Trust Funds have been in the news again after it emerged that parents of 18-year-olds without mental capacity will need deputyship – a potentially costly procedure – to claim their child’s money.

Given to children born from September 2002 to January 2011 by the Labour government, Child Trust Funds were intended to kickstart a savings habit.

Each child received £250, or £500 for those from a low-income family, and parents keen to build a nest egg could add contributions. Additional payments were made to children with disabilities.

The first tranche of 18-year-olds collected their savings in September, but it has come to light that parents of children without mental capacity will need to become deputies to claim the funds on their behalf.

In some cases the legal costs of this procedure could be higher than the fund itself. Questions have been raised in parliament and hopes are high that a simple solution could be announced soon.

At the start of the scheme, parents could invest the cash at a financial services provider of their choice. If they did not do so, the government placed the child trust fund monies with a range of providers. If you do not know where your child’s trust fund is invested, you can trace it here: https://www.gov.uk/child-trust-funds/find-a-child-trust-fund

Recently, parents with unwell children were refused permission to access their child’s trust fund early unless there was a terminal diagnosis.