Savings accounts used by parents to put away money for their children have been significantly impacted by the present economic situation.

Regardless of what incomes they fall into, families in the UK are finding it extremely difficult to save for their children's future, noted Family Investments.

In addition, the government's recent announcement to cut back child benefits will no doubt further stretch the finances of households, pointed out Kate Moore, head of savings and investments at the firm.

She stated: "Much of this money goes into short-term children’s savings or bank accounts so this cut will have a significant impact on those people looking to save for their children."

Commenting on the abolishment of the Child Trust Fund, Ms Moore advised families to continue using the provision till the end of this year.

It was recently highlighted by research carried out by MyVoucherCodes.co.uk that one in three parents has had to dip into funds put away for their kids in order to pay for the family's expenses.