Children born after 2nd January 2011 will miss out on the Child Trust Fund. With 66,000 births expected each month in 2011, and the new universal government savings scheme for children – the Junior ISA – not due to launch until the autumn, there are likely to be a lot of parents that won’t know where to turn for their children’s savings during the interim period. The launch of the Junior Bond with Bounty aims to fill the savings gap for those parents who want to start saving for their newborn straight away.
Parental engagement is increasingly important following the loss of the nudge to action that was provided by the CTF voucher. Bounty is a key source of information for new parents and their popular bags contain a wealth of information for every new family whilst they are in the maternity ward, so they are in the perfect position to keep parents informed of their savings options.
The Junior Bond offers similar long-term savings benefits to the CTF; it allows parents to contribute little and often to build a lump sum for their child’s future. Parents can choose to contribute between £15 and £25 each month and returns are tax efficient so long as payments are maintained for at least 10 years.
Money placed in the Junior Bond is spread across a range of investments, mainly in UK and overseas shares, fixed interest investments and property. There is also an option to invest in an ethical fund which is a popular choice amongst parents saving for children.
Kate Moore, Head of Savings and Investments at Family Investments said:
“There is a danger that many new parents will overlook a regular savings product in the absence of the Child Trust Fund unless options are presented to them from the outset. We are excited about our partnership with Bounty and the launch of the Junior Bond is a positive step towards our joint commitment to provide a simple and affordable product that will continue the good work CTF started.
“We recognise that new parents are often strapped for cash but have a desire to save for their child’s future. With the Junior Bond, parents are able to make small payments over the long-term into an account that is locked away for the benefit of their child. This will help those who hope to give their child the best start in life, whether to buy their first car, set up a home or maybe help towards the cost of university.”
“There’s no denying that bringing up a family is an expensive time, and with the current climate it’s more important than ever for parents to become savvy savers for their children’s future.”
Faye Mingo, spokeswoman for bounty.com said:
“It’s extremely important to us to work with companies that understand the needs and wants of our members so we’re thrilled to be partnering with the leading children’s saving provider. There’s no denying that bringing up a family is an expensive time, and with the current climate it’s more important than ever for parents to become savvy savers for their children’s future. Working with Family Investments enables us to offer our members a unique savings product that will fill the gap left by the discontinuation of the Child Trust Fund. We’re confident that it will be a big hit with parents.”
Parents can find out more information on the Junior Bond in inserts in Bounty packs or online at www.bounty.com/juniorbond.
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