Are you locked out of your Child Trust Fund?

If you set up a trust fund for a child who has learning disabilities, you might want to consider how to access those funds when the child reaches 18.

Child Trust Funds were set up under Labour in 2005 for children born from 2002 onwards as a way of helping parents save for their children’s future. Now, with many of those children reaching 18 - the legal age at which they can access the funds - it seems as though not everyone can get their hands on the cash so easily.

According to a recent report more than 200,000 disabled children face being “locked out” of their Child Trust Funds, because they will not be deemed to have the capacity to manage their own finances.

At the time, Child Trust Funds offered a government top-up voucher worth up to £500 if parents contributed too. All parents were actively encouraged to set up a fund for their children - with very little thought about what might happen in the future.

One parent of a 17-year-old disabled child told ThisisMoney.co.uk there had never been any indication of any problems accessing the money, saying: “The Government were, at the time, actively encouraging parents and grandparents to add to the Child Trust Fund for the child's future. Had we known, or even suspected, that there would be difficulties accessing the funds, we would never have encouraged others, such as grandparents, to add to it at birthdays.”

Parents can go to Court to get access to the money, however, not only is this a financial burden on families, it is emotionally trying as well. Applications to the Court of Protection for deputyship over the funds costs £365 - then there’s the volume of forms that need to be filled in.

Whilst this is a difficult process, I can understand why these measures are in place - it is to stop learning disabled people from being financially exploited. However, this is a lot for families to cope with on top of the day to day of caring for a child or adult with special needs.

The needs of the parents and the welfare of the child must be balanced, and the outcome must always be in the best interests of everyone, but there are a lot of issues for parents with children who lack mental capacity.

It is always best to seek specialist advice wherever possible and a solicitor can help. If you would like some more information about recovering a Child Trust Fund on behalf of one of your children, contact Downs Solicitors to see how we can help.