Back in March this year, we talked about the 200,000 people losing out by forgetting about their Child Trust Fund accounts. Money going unclaimed really is something we can’t stand at RIFT, and it’s happening again with forgotten NS&I Children’s Bonds. These “orphaned” accounts are currently bloated up with over £180 million in unclaimed cash, leaving hundreds of thousands losing out.

What are National Savings and Investments (NS&I) Children’s Bonds?

The National Savings and Investments (NS&I) Children’s Bonds system was designed to help save toward your kids’ future. The scheme started up in 2003, with the accounts paying a fixed interest rate and lasting for 5 years. You could then decide whether or not to renew them, at least until the scheme was cancelled in 2017.

The thing is, there’s a huge number of these accounts now basically abandoned unclaimed. In fact, an investigation by the Mirror sets the figures at comfortably over 807,000 people missing out on more than £180 million between them.

Why Are People Missing Out?

Now, ordinarily, Children’s Bonds ought to pay out automatically after they expire. When that happens, the cash goes into whatever bank account was specified when the bond was set up. However, where NS&I doesn’t have those details for some reason, they obviously can’t pay it out.

That means the money eventually winds up in a super-low interest “residual account”, where it earns a barely noticeable 0.03% a year. The accounts will stay open, but the cash won’t go anywhere until NS&I has the information it needs to pay up.

To be fair to NS&I, they do what they can to make sure people don’t miss out. They write to account holders a month before the bonds “mature”, giving them 30 days to say what they want to do with the money. It’s only if they don’t hear back that the residual accounts are set up.

How Can I Get the Money?

As for what your options are once your Children’s Bond reaches maturity, it all depends on the account holder’s age:

  • Under 16: a “responsible adult” can either cash it out or set up another kind of account with NS&I.
  • Over 16: they can make the decision themselves. Under 18s, for instance, could transfer the cash into a Junior ISA paying 1.5%. Over-18s won’t have that particular option, but can still decide to cash out or set up another type of account.

If you think you’ve got a lost Children’s Bond account to chase up, it’s important to get in touch with NS&I. If the account hasn’t expired yet, you’ll take a 90 days penalty on the interest for cashing out early. If it’s already mature, though, you can access the cash and decide what to do with it. Obviously, leaving it earning basically nothing in a residual account isn’t your best option here, even if it seems like the simplest move.

While you're following up on what you might be missing out on - take a minute to check if you're due a tax refund for work related travel and expenses. The average first payout is £2 - 3k and it only takes few seconds with our free tool.