Halifax Guaranteed Investment Plan

Robd1

One year ago we invested £20k in a Halifax Guaranteed Investment Plan. Its current value is just under £19k.

I have discovered that we can withdraw sums (penalty free) as long as we leave £3k in the plan.

We have now received the forms, and it appears that there are several ways of withdrawing the money, which can affect the guaranteed value of the remainder.

We intend to withdraw £15k, leaving £4k in the fund.

Can we do this and retain the guarantee on the remaining £4k reaching £5k after the end of the 5 years?

Or any other advice??

dunstonh

You can withdraw sums but they are not penalty free. In the 5 year period the value is subject to market fluctuations. The guarnatee kicks in at maturity (if required). So drawing money now when it has gone down means you are suffering a loss.

What has changed that in just 12 months you need to draw so much of it out?

Robd1

We just believe that we should invest in ISA's and something with more guarantee's?

dunstonh

Robd1 wrote: »

We just believe that we should invest in ISA's and something with more guarantee's?

You invested in a guaranteed investment plan but want something with more guarantees than something that is guaranteed?

Robd1

Good point!
I think the issue is that we are seeing our investment reduce, and are fully aware that it should have accumulated interest (similar to what we have lost)making us feel £2k out of pocket

dunstonh

You are not out of pocket though. In the period until maturity the running value will fluctuate but it is guaranteed on maturity. If you cash a chunk in now you are guaranteeing a loss on that chunk which any alternative will have to make up.

Many providers of these guaranteed plans dont give out running values because it can mislead or confuse people as the key benefit is knowing that on the 5th anniversary you are going to get you money back (and anything else the product gave provision for, depending on what version you had).

So, in that interim period you should more or less forget about it.