NFU Mutual: Children's pensions an alternative to trust funds

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NFU Mutual: Children's pensions an alternative to trust funds

Fri 25th Jun 2010

Setting up a children's pension as an alternative to the scrapped child trust fund (CTF) scheme could be a good option, according to NFU Mutual.

Following the announcement that no more CTFs were to be opened from January 2011, the institution has suggested setting up a children's stakeholder pension as another way to make tax-free savings.

While some schemes require a minimum investment of £20 a month, the government also contributes a further £20 for every £80 invested.

The fund is also free from capital gains tax, meaning that any savings invested will quickly begin to accrue interest.

However, any savings that are made into the account cannot be accessed by the child until they reach the age of 55.

Saving this money could come in useful for the younger generation as they hit old age, with plans currently underway to review the current retirement age of 65 years old.

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