The renewed Baby bond, which can be purchased as of today, is another financial tool for assisting parents in bringing up their children, Minister for National Economy Mihály Varga said.
The new Baby bonds are available as of 2 December 2013 at the offices of the Hungarian State Treasury. This kind of investment can only be held on a Start account. The Government stimulates the opening of such an account and the purchasing of Baby bonds through tax-free returns, extra interest and state subsidy.
Mihály Varga and Deputy State Secretary for Monetary Policy Kornél Kisgergely, who had arrived with their small children, were among the first to have opened a Start account and purchased from the new government securities at the regional service point of the Hungarian State Treasury’s 5th district office.
Mihály Varga emphasised that in addition to the family taxation system, lower public utility tariffs, reduced taxes of low-income families and the parental benefit extra the new Baby bond will be another, significant financial instrument for supporting families.
The Minister stressed that the management of the Baby bond has become easier, and therefore he hopes that more parents will use this option than before. The Baby bond continues to be available only through accounts of the Hungarian State Treasury, but beginning from today parents are required to go only once to an office or regional service point of the Treasury, as they open the Start account. The Baby bond can currently be purchased in the offices and 10 regional service points of the Hungarian State Treasury.
On the basis of the former press release of the Ministry for National Economy, the state transfers HUF 42 500 to the Start account as a life-start support. After that, the Baby bond yields a premium of 3 percent above the annual inflation rate, which is based on the consumer price index of the Hungarian Central Statistical Office for the previous year, and has a tenor of 19 years. Provided an amount of only HUF 1000 a month is paid regularly to the account, at the end of the bond’s term the child will have savings of some HUF 600 thousand, while in case of regular payments of HUF 5000 per month savings upon maturity will total some HUF 2.5 million.
The first series of the bond is launched on 2 December 2013, for which the first interest payment is due on 1 February 2014. This will be available for children born until 31 January 2014, while for children born after that date parents can purchase bonds which bear the year of the child’s birth.
At the request of the beneficiary, the amount accumulated on the Start account is paid after the child’s 18th birthday.
(Ministry for National Economy)
