Parents in plea to merge CTFs with Junior ISAs
Post by Kelly Swift
on 04 November 2011 in Family & Finance
A group of parents has called on the government to make Junior ISAs open to children who already have Child Trust Funds.
The new tax-free Junior Individual Savings Accounts, which launched on Monday, are available to anyone under the age of 18 who does not already have a Child Trust Fund (CTF), the new saving scheme's predecessor. But parents of youngsters with CTFs believe their children are missing out.
Research by consumer magazine Which? has found that children with the new Junior ISAs can get better interest rates than those with CTFs. The group said the market average for CTFs on a balance of £1,000 is 2.41 per cent (excluding bonuses paid if a specified amount is credited to the account), while the market average for Junior ISAs is 2.63 per cent.
So far 151 parents have called for a parliamentary debate on the issue. However, according to a report by the Daily Mail, the Treasury has said there are no current plans to merge the two schemes. A spokesman added that while the government will come back to the issue, it is far too early to make a call on how best to serve children with CTFs.
Introducing their online petition, the parents claim their children will be "subjected to a form of discrimination", adding that they believe the move sends out the wrong message about savings to youngsters, parents and grandparents.
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