Stakeholder Child Trust Fund Account

Failing to use you child's Child Trust Fund voucher within the 12 months from the date it was issued will result in the Inland Revenue opening a Stakeholder Child Trust Fund on your child's behalf.

The Stakeholder Child Trust Fund account is ruled by a number of specific conditions set out by the goverment. In setting out the conditions by which the account must operate, the government do not guarantee or recommend this type of Child Trust Fund account. The onus is on you to chose the most appropriate Child Trust Fund account which best suits your situation.

Offered by all of the Child Trust Fund providers , the Stakeholder Child Trust Fund account will appeal to parents unfamilair with stock market based investments and nervous about the risk of such investments. Adhering to the government requirement accounts should be largely equity market based, invested in more than one company and be a suitable investment over the period, the Stakeholder Child Trust Fund invests in a range of companies shares by utilising tracker and balanced managed funds which are considered lower risk investments.

The Stakeholder Child Trust Fund account features 'lifestyling' designed to protect the accumulated wealth of the fund from a sudden market downturn before your child's eighteenth birthday. On (around) your child's thirteenth birthday, the provider will consider the relative performance of the Stakeholder Child Trust Fund account and the investment horizon and will decide how soon, and how much of the investment to switch into safer investments such as cash and government stock (Gilts).

Parents, family members and friends can all contribute to the Stakeholder Child Trust Fund account. Direct Debit, Direct Credit, Cheque and Standing Order payments of £10 or more will all be accepted up to a collective total of £1200 per annum.

Whilst annual management fees of the Stakeholder Child Trust Fund vary, expect to pay no more than 1.5%.