For thousands of young adults across the UK, there could be a financial windfall just waiting to be uncovered.

New figures reveal that a staggering £1.4 billion is sitting in unclaimed Child Trust Funds, with 728,000 account holders unaware of their existence. These funds, set up for every child born between September 2002 and January 2011, were initiated with a government contribution of at least £250, and have grown over the years through interest and additional contributions.

The average value of these accounts is estimated to be around £2,000, yet campaigners say the current system for accessing them is flawed.

The Share Foundation, a charity that helps track down unclaimed funds, is advocating for automatic payouts by the time account holders turn 21, particularly for accounts where no action was taken by parents or carers to manage the funds. These “lost” accounts — numbering nearly 450,000 and worth £927 million — were allocated by HMRC when no action was taken by families.

The proposed system would link National Insurance numbers to these accounts, ensuring funds can be traced through pay-slips, student loans, or benefits.

A system in need of reform

These savings are not held by the government but are kept in banks, building societies or other saving providers until withdrawn or re-invested. Young people can take control of their Child Trust Fund at 16, and withdraw funds when they turn 18, as the account matures.

Latonya Skye-Paterson, now 20, discovered her hidden savings thanks to a college tutor. “I found I had £955 in there, which is a lot. A lot more than I was expecting… it helped me so much,” she told the BBC. However, her story highlights how many young people are still in the dark about the accounts they own. And for many, these unclaimed funds could provide vital financial relief amid the ongoing cost-of-living crisis.

While HMRC has acknowledged the charity’s proposal, it has also flagged significant legal and logistical challenges in implementing automatic payouts.

Tackling existing biases and inefficiencies

Innovative solutions in financial technology, like those championed by Vesta Insights founder and CEO Veronica Breene, could play a transformative role.

In our interview with Veronica, as part of The Future of Finance: Building a Better Tomorrow, she explains why AI could play a role when it comes to inefficiencies and existing biases in the financial sector, and the value in increasing credit accessibility to traditionally marginalised groups.

 

How to access your Child Trust Fund (CTF)

The first step is identifying which bank, building society, or investment provider holds your account. If you already know the provider, you can contact them directly to start the reclaim process.

If you’re unsure, HMRC offers a free tool to help you locate your CTF — available to parents and to young people aged 16 and over.