20-Year-Old In UK Receives £955 From Child Trust Fund She Didn't Know She Had: Do You Have One, Too?

Latonya Skye-Paterson was astonished to learn she had a Child Trust Fund after her college tutor encouraged her to check online. She discovered £955 in her account, a surprising sum she hadn't expected.

"I found I had £955 in there, which is a lot—much more than I was expecting. It helped me so much," she said.

New figures reveal that £1.4 billion remains unclaimed in accounts belonging to 728,000 young adults. According to The Share Foundation, a charity specialising in tracing lost funds, many people are unaware of this potential windfall.

A senior MP is urging the government to automatically distribute funds from dormant Child Trust Fund accounts, despite officials citing concerns over the complexity and cost of such a move.

£955 Found In Forgotten Savings Account

Latonya is one of the estimated 6.3 million people born between September 2002 and January 2011 who are eligible for a Child Trust Fund. These government-supported savings accounts typically received an initial £250 deposit.

These individuals could have more than £2,000 waiting for them in a childhood savings account. According to Her Majesty's Revenue and Customs (HMRC), individuals born between September 2002 and January 2011 likely have a Child Trust Fund with an average balance of £2,200 ready to be claimed.

In an X post, HMRC said: 'If you were born between 1st September 2002 and 2nd January 2011, you are likely to have a Child Trust Fund worth an average of £2,200. Already turned 18? It's yours to cash in. Find out more on GOV.UK.'

The intention was for these tax-free savings accounts to grow significantly by the time children turned 18. However, like many others, Latonya was unaware of the existence of her Child Trust Fund when she reached adulthood.

The Share Foundation advocates for automatic payouts of certain Child Trust Funds if they remain unclaimed by the time account holders reach age 21.

College Tutor's Tip Leads To £955 Surprise

'I think it's a great plan to be honest,' Latonya said. 'My college tutor told me about it but my brother is a year older and went to the same college and he wasn't told about it so it's luck of the draw who knows, who tells who. Especially with cost of living, getting it automatically when you didn't know you had it could really give people a break that they need,' she added.

This 'default withdrawal at 21' plan specifically targets accounts where parents or guardians failed to establish a trust fund after receiving the initial government voucher. These 'lost' funds are known as 'HMRC allocated accounts' and encompass 449,000 accounts with a collective value of £927 million.

Campaigners are advocating for the automatic disbursement of these funds to account holders using their National Insurance numbers if no claim is made by their 21st birthday. Account holders can be contacted using their National Insurance numbers through records like PAYE payslips, student loan applications, or benefit claims.

Unclaimed Fortune

Sir Geoffrey Clifton-Brown, a Conservative MP, expressed his support for automatic payouts on Radio 4's Money Box. 'I liken this money a bit to a treasure trove buried on a [desert] island in vast acres of sand expecting the poor recipients on these child trust funds to go and find this money,' he said.

'I think there's a lot more we could do to encourage the government to find the recipients,' Sir Geoffrey added. He vowed to raise this issue with the Treasury and HMRC at their next appearance before the Public Accounts Committee.

HMRC acknowledged the 'default withdrawal at 21' plan proposed by The Share Foundation but expressed concerns about its complexity, stating that implementing such a system would present significant challenges.

'For HMRC to close these accounts, obtain the savings in those accounts and transfer them with or without the owner's consent would require careful legal consideration,' a spokesperson said.

The spokesperson further explained that implementing this plan would necessitate the development of "operational systems and resources" across various government departments and Child Trust Fund providers to monitor and manage the transactions effectively.

'The government is committed to reuniting all young adults with their CTFs and recognises the importance of ensuring that young adults can benefit from these funds as they reach adulthood,' the spokesperson explained.

Finding Your Child Trust Fund

You can locate your Child Trust Fund using the Government Gateway service. To do so, you must log in or register and have your Child Trust Fund's unique reference number or your National Insurance number ready.

The Share Foundation offers a free service to help you locate your Child Trust Fund. For further information on Child Trust Funds, visit the Money and Pensions Service, a government-backed organisation.