24/07/2009 09:18 BST | Updated 22/05/2015 10:12 BST

What To Do With Your Child Trust Fund £250 Freebie

The other half and I had yet another slightly tense conversation about family finances last night. I'm nearly 22 weeks pregnant with our first baby, and suffice to say that as he only moved in three weeks before I fell pregnant we were barely a family, never mind a family with finances.

While I was chucking in words I've picked up along the way, like "maternity pay", and "I won't get any", he was throwing around scary phrases like "savings account for when it's older". It all got in a bit of a muddle as we realised we have very little idea about the best thing to be doing right now. So we stopped talking and went swimming.

Apparently, one important thing to do is to set up a Child Trust Fund with the free £250 the Government gives out to every child. It can't be spent until they're 18, when it will either go on drugs or academic texts depending on the quality of your parenting skills to that point. No pressure intended.

Here's a very helpful extract from "The ABC of Child Trust Funds" on

"Since April 2002, every child has received a Child Trust Fund voucher worth £250 (or £500 if the family has a low income). This must be invested for the long term and cannot be spent until the child reaches age 18. And then you will not have any say, since it is the young adult that will be able to spend the money on whatever they want – gap year travel, house deposit, university fees or maybe a slap-up meal for mum and dad for investing so wisely!

"If you don't elect where to invest the voucher within the first year after birth, the funds will go into the default account choice of HM Revenue and Customs. This is currently into a stakeholder plan where part of the money is invested into stocks and shares and then into less volatile bonds as the scheme matures.

"Now this is starting to sound like a nightmare and something to be steered well clear of – but if you do that, you could be missing out on one of the best savings plans for your child so take some time to do a little research."

Fortunately, the article goes on to explain more about the fund and options on how to invest it.

Ho hum. Something else to add to the To Do list.