Need help with investing/saving £100,000

ReportInvestor

dh, it's slightly misleading to state that there are no penalties after 5 years.

But there can be a MVR / MVA exit penalty imposed in the event of market falls at the discretion of Norwich Union. We all hope there won't be .

Although the With Profits Guaranteed Fund gives you the opportunity of getting your initial investment back after five years, this costs an additional 0.5% pa for those five years.

This guarantee lapses if not taken, then kicks in again on the 10th anniversary. The 10th anniversary guarantee is worth little.

And there is no guaranteed MVR free date AFAIK.

At least the 21st Century t&cs admit "the term "profits" includes the possibility that there could be "losses" ."

Best wishes to both montycat and jem16 in their very difficult circumstances. Please forgive our technical arguments. This investment will probably turn out OK and seems to fit mc's "cautious" profile.

montycat_2

Just to clarify ,when I took out the Bond ,it was a 1/3 split into a savings account paying 7% APR for 6 months and 2/3 into the Bond .
The commision goes to the Portman and then this is used to fund the 7% on the Savings (as I understand It ).I am a Cautious Investor -3 kids under 10 means that I don't take risks .
Personally I congratulate myself for being able to set up a financial future ,keep house ,work part -time and ,grieve at the same time .
Maybe in a few more years I will want to be more adventurous but as it stands ,I am happy with the choice I made
Setting up a future out of money I don't want is certainly an experience I hope others don't have to go through whilst young .

EdInvestor

Hi Montycat

I'm sorry if the slightly blunt tone I've used has upset you. If I sound a bit outspoken it's because it makes me really angry when I see the building societies and insurers taking advantage of people in your position. :mad:

I am a Cautious Investor -3 kids under 10 means that I don't take risks .

You are aware, I assume - the advisor did tell you - that 50% of your money in the bond will be invested in the stockmarket?

The list of the WP funds investments is here:

http://www.norwichunion.com/library/pdfs/IN16013.pdf

Now I do hope that you will not suffer any loss as a result of taking these various risks ( 50% equity investment plus further risk investments,exit penalties, income coming from capital etc). The chances are you will do OK, because the stockmarket is not in "Boom mode" and about to crash as it was in 1999/2000.You funds should grow.But keep a close eye if you are taking income, to make sure the capital is earning more than what you are taking out.

Let me make another suggestion. Since you won't know for a while if you've made a loss or not, I suggest you print off this thread and keep it somewhere safe, so that if do make a loss, you have the information to make a misselling claim.

PS. If you say you are a "Cautious Investor", in FA-speak, it means that you DO take some risks.

Did you realise that? Or were you told something different?

cheerfulcat

dunstonh wrote:

Bit of a daft comment. Withdrawing money from the bond is the same as the bank as far as it being treated as capital. If the bank only pays 3% net and you draw 5%, then that will go down too.

Yes, but withdrawing money from an insurance " bond " does actually involve cancelling units so is de facto taken from capital whereas taking the interest generated from a deposit account doesn't affect the capital directly.

Montycat :wave: ; glad you got sorted out. Best of luck.

montycat_2

As I said ,I sat in the room with the Portman advisor and ,my IFA friend -I was made aware of everything you have mentioned .
I have read the policy and ,I was talked through the diferent investor terms .I do know that some of my money is in the stock market .
My IFA friend ran circles around the Portman guy and after we left ,gave him the thumbs up .
I can back to the Portman anytime I need to and will be seeing him in 8 weeks to look at my fund .
Thanks for all your advice especially ,as I only posted to tell Jem what I had done lol.
As I said ,I am happy with the decision I made and I have eggs in other baskets .
When you lose a loved one ,money is NOT everything.

dunstonh

Yes, but withdrawing money from an insurance " bond " does actually involve cancelling units so is de facto taken from capital whereas taking the interest generated from a deposit account doesn't affect the capital directly.

Interest paid on a deposit account is added to the capital. If you make a withdrawal, you are removing that capital. One may have units, the other not but in both cases, you are withdrawing capital.

Ed was making out that a negative on a bond was if you draw out more than you make the bond value would decrease. However, that would apply to any product, not just bonds. Hence my rebuttal.

As I said ,I sat in the room with the Portman advisor and ,my IFA friend -I was made aware of everything you have mentioned .
I have read the policy and ,I was talked through the diferent investor terms .I do know that some of my money is in the stock market .

montycat, Ed is anti financial advisors and insurance companies. We can never do right in his eyes so please do read his comments with that in mind. Personally, I find it refreshing to see a post from someone that is pleased with what their advisor does. Although most people are, you only get to see the negatives posted most of the time and that feeds those that don't like financial advisors.

montycat_2

Well.thankyou for the compliment .I liked the way the Portman advisor treated me ,as an individual and an intelligent individual at that .
I understand why some banks rankle people -I ignored the 2 banks I went to ,for the very reason they assumed I would be banking with them as ,opposed to you may possibly bank with them .
In fact .my late DH and I got stung badly by an IFA but I don't tar all with the same brush .
There are good and bad in all areas of life .
I would also like to Thank you and Ed .for bringing a smile to my face .Your bantering made my day .Lol

ReportInvestor

dunstonh wrote:

After the 5th anniversary you can draw out the lot at any time following without any penalty of any sort. The amount paid will be the original investment plus daily bonus (based on a unit price which cannot decrease) and any additional bonus accrued, minus what you may have withdrawn already.

Are you still sticking to this statement, dh? It doesn't match the t&cs I read, but perhaps I was reading the wrong ones??

dunstonh

ReportInvestor wrote:

Are you still sticking to this statement, dh? It doesn't match the t&cs I read, but perhaps I was reading the wrong ones??

They have had 3 versions of their with profits fund in the last 12 months. The last change was on 18th December. The current one doesnt seem as attractive as the one this time last year. There is a limited window on the 5th and 10th year.

That being said, as UWP funds go, this is certainly one of only two I would even consider. Although I would encourage alternatives unless the overide was the security. A good diary system and an IFA that will give servicing should ensure that a potential exit is possible.

ReportInvestor

Interesting, dh.

I wonder why NU made the terms worse recently? Perhaps they realised they can't promise investors that they can have their cake and eat it as with profits has tried to claim over the years.

So just to confirm for potential investors.

The current with profits element of the NU Portfolio Bond does not have any MVR free window of opportunity, even if you pay extra for the "guaranteed" version