Child Trust Funds: Are you the owner of pound 2,242 in unclaimed funds?

Over £105 billion is sitting in unclaimed savings accounts for individuals aged 18 to 23

Here's how to locate misplaced child trust funds.

HMRC has issued a warning that 758,000 young people still owe more than 1.05 billion in unclaimed savings accounts.

The tax collector is contacting those between the ages of 18 and 22 who might not be aware that they are due Child Trust Fund (CTF) payouts.

The previous Labour government established CTFs in January 2005. In 2011, they were phased out and replaced by Junior ISAs. Thus, children and young people between the ages of 13 and 23 are at risk for developing a CTF.

A minimum government deposit of £250 was required to open the accounts, which either earned interest or profited from investment growth.

Parents of younger teenagers might also have forgotten where the CTF is and how much money it contains, even though those who are 18 years of age or older are being urged to claim their money.

A senior MP supported calls earlier this year for CTF payouts to be made automatically.

The Public Accounts Committee chair of Parliament, Geoffrey Clifton-Brown, MP, has urged the government to automate the payouts, saying, "I compare this money to a treasure trove buried on a desert island in vast acres of sand, expecting the poor recipients of these CTFs to go and find this money."

We could, in my opinion, do much more to persuade the government to identify the beneficiaries.

However, the amount continues to rise, and many people are not aware that they might be owed money.

According to HMRC, thousands of 18-year-olds are now eligible to claim their savings pot because September is the most common birth month.

Many lost CTFs will be because parents and kids aren't even aware they have the account, don't know which provider the money is with, or don't know how to find it, according to Charlene Young, senior pensions and savings expert at AJ Bell.

She stated: "The government created more than 25% of accounts since parents did not do so within a 12-month period.

How does one define a child trust fund?

For people born between September 2002 and January 2011, CTFs are tax-free savings accounts. Both investment and cash savings accounts were offered.

Every CTF began with some money because the government paid 250 for each child born, or 500 for low-income families.

Your initial government contribution would have been automatically invested in a stakeholder fund if you had done nothing with it. Many of these funds, however, have not yet been claimed.

Some parents are unaware of the location of their account or have forgotten they have one.

Additional contributions could be made, and growth in investments or interest could be accrued. When they turn eighteen and the account matures, young people can take control of their child trust fund.

As per official statistics, the average CTF value in September 2025 was 2,242.

In November 2011, junior ISAs took over the program after it closed to new applicants.

With a child trust fund, what are your options?

It is possible for anyone with a CTF to move their money to a more contemporary junior ISA (JISA). There are several similarities between the two accounts, including the same tax benefits, the same yearly limit of £9,000, and the fact that the funds are locked away until the age of 18.

On the other hand, junior ISAs usually offer better interest rates, better investment options, or lower fees.

"Many CTF providers are consuming funds by charging exorbitant fees for account management, as was brought to light in a Public Accounts Committee report last year. A JISA on a contemporary platform may cost about 0.25% annually, plus the cost of a tracker, which can be as low as a few basis points, according to the report, while many accounts charge 0.5 percent annually for a portfolio of passive funds," Young continued.

Some of the most competitive cash JISAs, like the one provided by Coventry Building Society, currently offer interest rates of up to 4 percent to savers. One Family, one of the biggest CTF providers in the UK, offers a CTF rate of 3% at the moment. At the age of 18, that drops to 1 in 5 percent.

It's easy to transfer your CTF to a JISA; just ask the provider you wish to switch to for a transfer form, and they will get in touch with the CTF provider. Note that this may require several weeks, particularly if you must first identify your CTF provider.

A child can either use the funds or transfer them to an adult ISA and keep making contributions after they turn 18. Parents should be cautious because their children may decide to cash in their CTFs and Junior ISAs, which are legally theirs and can only be accessed by them when they turn 18.

Why are funds from the Child Trust not being claimed?

The Public Accounts Committee (PAC), which examines government expenditures, expressed concern last year that a large number of account holders are unaware of or have forgotten their savings.

There is an estimated 1 point 4 billion in unclaimed CTFs that belong to children who are 18 years of age or older.

The MPs stated that HMRC needs to do more to locate and get in touch with those young people, many of whom come from low-income families.

Additionally, they said providers are not doing enough to reconnect forgotten accounts with their owners, despite receiving "very high" fees of up to £100 million annually for passively managing CTFs primarily made up of government funds.

Unclaimed CTFs belonging to children who are 18 years of age or older are estimated to be worth 1 point 4 billion.

Currently, HMRC is encouraging youth to withdraw their government-provided savings.

"We want to reunite young people with their money and we're making the process as simple as possible," says Angela MacDonald, deputy chief executive and second permanent secretary at HMRC. "Thousands of child trust fund accounts are sitting unclaimed."

How to find your misplaced Child Trust Fund.

CTFs are kept in banks, building societies, or other savings institutions rather than by the government.

Teens can get in touch with their CTF provider directly if they or their parents and guardians already know who's who. A helpful list of CTF providers can be found on gov . uk.

They can use this tool on the government website if they don't. For young people to access the information, they will need to provide their date of birth and National Insurance number.

According to MacDonald at HMRC, parents and children do not have to pay anyone to find their CTF because this is a free service.

Third-party agents are marketing their services to look for CTFs, and they always charge for their services, according to HMRC. One agent charges up to 350, or 25% of the savings account's value.

Over 563,000 consumers have found their child trust fund using the free gov . uk tool in the last 12 months.

"Once you have located the money, it is up to you what you do with it," Young continued. The funds are available for withdrawal or transfer to an adult ISA in your own name. Until then, your funds will remain in an account that is inaccessible to anybody else, potentially incurring exorbitant fees. Your yearly ISA allowance, which is £20,000 for those over 18, will not be affected by anything you move to an adult ISA when it matures.

You might be able to lower your fees and have a much wider range of investment options if you have a CTF but are still under the age of 18. The tax-free advantages of an ISA will still be available, but the funds will remain locked up until you turn 18.

HM Revenue and Customs: Learn More.