Child Trust Funds..

I've stuck mine in a Nationwide cash CTF. My kid is 2. Since the equity CTFs move the money into bonds in the last 5 years and charge you at least 1.5% throughout, the return needed during the first 11 years to recoup all the charges is about 2.5% over cash.

It's possible that some of the funds will achieve that but the risk of loss doesn't seem worth it given we're talking about 250.

"John Redman" wrote in message news:cv8gbp$a6h$ snipped-for-privacy@newsg2.svr.pol.co.uk...

If that's the attitude towards the investment for the amount invested that 'you' have, I wouldn't dare to argue with you at all. That said, many people may use the facility to save more than the freebie 250.

For those prepare the accept more risk in return for more potential reward, The Children's Mutual appear to offer access to some of the better funds (past performance etc!) than most.

No doubt but the first 2,000 extra would go into a child savings account anyway, not a CTF. It would be just as tax free - interest < 100 a year - and you can withdraw it at any time. If I had more to save for her I'd stick it an ISA with a lower charge than that and gift it to her. CTF seems an utterly futile product altogether which I've only bothered with because I've handed over thousands and want some of it back.

I really can't see the point of paying 1.5% a year for a fund manager to attempt to beat the cash deposit rate over the first 11 years. In the last 5 they're going to underperform by 1.5% because they're still going to charge you their percentage even though they are effectively in cash at that point. They'd have to achieve a steady 2.5% better than cash for 11 straight years in order to offset that. The number who've managed to do that over the last

"John Redman" wrote in message news:cv8mqj$239$ snipped-for-privacy@newsg3.svr.pol.co.uk...

I'm agree with you John, although I am prepared to take the wait and see approach.

The Stakerholder CTF's look poor value. There doesn't seem to be many Share CTF's available, the self select route appears cost prohibitive and generally with managed funds, the chance of choosing one of the better headline grabbing funds that outperform the market is 1 in 10. There doesn't appear to be any index trackers, although I wouldn't choose a tracker since I believe we are in the early stages of a secular bear market.

I'm going for the cash option with the view to move into shares when there are more funds to choose from and the time is right. Nationwide looks the best cash option at the moment with a rate of 6% if you contribute at least

"Jane Tweedynn" wrote

I noticed that too, though given my other half isn't earning, we could put

Well, yes, me too....as you say, wait and see if the market matures, and then one can always switch.

For what it's worth, looking at the conversation "above", Britannia have a starting rate (for two years, but variable of course) of 6.25%, F&C have a 0% annual charge stakeholder (based on a FTSE 250 tracker) and there are a few self select share accounts to choose from.

That's not strictly true - for example the comdirect self-select CTF only charges the 12.50 dealing fee. One could buy an investment trust via comdirect and have no further charges (apart from the management charges embedded in the IT).

I think is potentially a very good deal - especially if the CTF is topped up.

Thom

I just re-visited some of the information and noticed that either I misread the F&C offering, or they've changed it. Not sure which, but regardless, they actually have a stakeholder with 0.7% charge, and a choice of managed funds with 0.0% charge.

Brings to light that I'd appreciate any feedback anyone has regarding the various details I've listed!

The contact form is working now too :) so that makes it easier (and possible) to contact me regarding the pages. Cheers...

Just as a matter of interest, as these are designed to put up to £100/month into, what exactly happens with the trading fees? Do you loose 12.5% of your £100 each month?!