FCA urges young adults to check for unclaimed Child Trust Funds

Thousands of young adults returning to college and university this month may be sitting on unclaimed Child Trust Funds, a government‑run savings scheme that matured for those born between 1 September 2002 and 2 January 2011. HM Revenue & Customs data show that 760,000 of these accounts remain untouched, each holding an average of £2,000, meaning a potential windfall of hundreds of thousands of pounds could be waiting for students to use on laptops, textbooks, rent deposits or future savings. The Financial Conduct Authority (FCA) is urging anyone aged 15 to 24 to search “find my Child Trust Fund” on GOV.UK and claim the money themselves, stressing that the tracing service is free and that paying third‑party firms is unnecessary.

The FCA warns that some companies, including those advertising on social media, are offering to locate and claim Child Trust Funds for a fee, sometimes charging as much as £400 or imposing monthly subscription charges for a one‑off service. While these firms may be regulated as claims‑management companies, the tracing activity itself does not usually require FCA authorisation, meaning they are not covered by the regulator’s cap on fees and complaints may fall outside the Financial Ombudsman Service. Consequently, consumers could lose a substantial portion of their savings to middlemen for a service they can perform at no cost.

In response, the FCA is launching a review of the Child Trust Fund scheme to address issues such as young adults being unreachable when they turn 18, the risk of losing contact with their accounts, and whether vulnerable individuals face barriers to accessing their money. The review will also examine how firms handling these accounts comply with the Consumer Duty and ensure fair value for claimants. By highlighting the free government tracing tool and scrutinising the practices of third‑party firms, the FCA aims to protect students from unnecessary charges and help them retrieve funds that could ease the financial pressures of higher education.

⚡ Effects Interpreter