Norwich Union investment fund - good or bad?

RichardJW1

Hi,

I was hoping that some of our resident experts here could give me some advice on this Norwich Union 'With-Profit Inflation Protected Guarantee Fund'.
Seems its an offshore account.

Someone has advised me to invest 50k in this for a 5 year period, I am a bit concerned whether this is the right way to go, I am no guru when it comes to investments so when he gave me the low-down I was a bit cautious and told him I'd make a decision by the end of next week.

What do you all think? Safe bet or not given the current financial climate?

Many thanks in advance for your points of view

Richard

dunstonh

Seems its an offshore account.

Its not. Its on their onshore investment bond.

What do you all think? Safe bet or not given the current financial climate?

Its been very popular. Capital guarantee that increases annually. Fund has a good track record. Product has access to over 100 unit linked funds.

I'm not a fan of with profits but I have a number of these investment bonds on my books (mainly as NU is one of the cheapest providers) and some of these are in the with profits fund. Not one of the WP holders is disappointed. However, it is a type of investment that is less liquid than typical unit linked funds as the provider can impose a penalty in the early years if you try and get out at a time when the markets are lower than when you went in. However, from year 5 that is largely a non event on this fund as you have the minimum return of capital invested plus inflation.

If you are going to do it then act quickly. Its about to lose its initial allocation later this month (on 50k that means moving from 102% to 100% assuming full commission - fee basis would be cheaper and give a better allocation though). Nu have said that they can no longer justify to offer the guarantees that it gives and give the same allocation rate and commission as the rest of their investments. The changes will effectively pay for the guarantee.

RichardJW1

Many thanks Dunstonh, I appreciate you taking the time to answer my question.:beer:

Richard