NATIONWIDE ISSUES REPORT ON CHILDREN’S SAVINGS

12 December 2005

Nationwide has today issued a report on Children’s Savings. The report suggests that Britain’s culture of ‘buy it now and borrow’ is contributing to fewer people saving, a rise in personal debt and a need to educate youngsters by tackling these issues early.

Within the report, Nationwide has issued a Children’s Savings Action Plan which it believes will help change attitudes to saving and the way people manage their finances. The six point action plan calls for:

• The Government to remove distortions in tax and savings that discourage parents from saving for their children
• The £250 and £500 Government contributions to the Child Trust Fund plus any top-ups made by parents to be index-linked
• An extra Child Trust Fund top-up to be introduced at age 13-18 which is linked to achievement of financial educational goals
• The Government to set a clear target for the number of Child Trust Fund vouchers to be deposited within the first three months of receipt and to set up a monitoring system to ensure this target is met
• The Government to encourage additional contributions to Child Trust Funds from parents to further the savings habit
• The Government, the FSA, the industry and parent groups to create new messages on savings that make the subject exciting to children and encourage the savings habit

Stuart Bernau, Nationwide executive director, said: “Nationwide calls for the government, industry and parents to work together to ensure that young people get the financial start in life they deserve. We believe Nationwide’s Children’s Savings Action Plan is the first step to addressing this issue. If all our recommendations are taken on board, today’s children will be better equipped to deal with their financial futures.”

Click here for the report