Help...is this £50k invested safely...I've got 4 days to cancel it...

leadhead

My brother has just left the country, maybe for good, and ive just been given £50k in investments...

2 of them are at £12.5k each and are a 3 and 4 year Barclays Defined Returns Plan through Woolwich Plan Managers

the other is a £25k with profit IPG plan..with Norwich Union

I read in the correspondence that being a "cautious saver" that the initial investments are guaranteed, and that fees and commissions of around £2k have already been paid for the organisers of these...

I also read that the charge for looking after these plans will be around 1.3% per year....

All the calculations and proposed expectations are based on 4, 6 or 8% growth...........which looks fine.......but...and this is my question

If the percentage growth is only say 1% or less, will they still take the charge of 1.3% fees, and in doing this, will it reduce my return capital to less than my original investment...........therefore going against the "guaranteed 100% return of capital...............or have i got my facts wrong, and cant this happen....

Ive got 4 days left of the cooling off period to cancel these plans...so any quick advice would be nice, if the original £50k IS guaranteed on maturity.........then i will be happy, (even tho it will be worth less in real terms due to inflation) and may look for something better later...

dunstonh

Initial thought - poor quality advice and low quality products (or set up on bad terms). Read on for reasons.

2 of them are at £12.5k each and are a 3 and 4 year Barclays Defined Returns Plan through Woolwich Plan Managers

Terms are not very good and better options exist on the whole of market (IFA).

the other is a £25k with profit IPG plan..with Norwich Union

Nothing wrong with the fund. Its been a steady performer despite the volatility. However, it is a medium risk fund until year 5 when the guarantee kicks in. It then drops to low/medium.

Big issue is that requires the use of an investment bond tax wrapper and investment bonds only really start to get tax efficient and cost efficient around 50k-100k onwards. 25k in an investment bond would really only be considered suitable if you are a higher rate tax payer and the investments were higher yielding, trusts were required or the over 65 age allowance reduction was likely.

In summary, you can do better.

westy69

so basically get a 2nd and maybe 3rd opinion...

ad44downey

leadhead wrote: »

the other is a £25k with profit IPG plan..with Norwich Union

...

If it's 'With-profits' then that immediately rings alarm bells with me.

leadhead

dunstonh wrote: »

Initial thought - poor quality advice and low quality products (or set up on bad terms). Read on for reasons.



Terms are not very good and better options exist on the whole of market (IFA).



Nothing wrong with the fund. Its been a steady performer despite the volatility. However, it is a medium risk fund until year 5 when the guarantee kicks in. It then drops to low/medium.

Big issue is that requires the use of an investment bond tax wrapper and investment bonds only really start to get tax efficient and cost efficient around 50k-100k onwards. 25k in an investment bond would really only be considered suitable if you are a higher rate tax payer and the investments were higher yielding, trusts were required or the over 65 age allowance reduction was likely.

In summary, you can do better.

Thanks for that, most appreciated...I realised he could have done better, when i realised he did it through Barclays and not an Independant Financial Advisor...........

leadhead

westy69 wrote: »

so basically get a 2nd and maybe 3rd opinion...

Thanks, i hoped there would have been more response,,,,,,,

leadhead

ad44downey wrote: »

If it's 'With-profits' then that immediately rings alarm bells with me.

Thanks, but why is this....I know nothing about Investments........Relieving Tesco of heavily coupond or free goods is my forte..........

Lokolo

Yeh well none of us our experts (not even Dunston, he supports Chelsea!), and ones who know a lot, are not allowed to give out financial advice on this forum anyway.

Ask around with friends or family, see who they go to see (IFA wise) and then go yourself, see what they have to offer. Get a number of viewings with different ones (if you can), whichever one you find you can trust the most with your £50k, go with them. (and you can always post what they say on here and we can then tell you whats what)

leadhead

Lokolo wrote: »

Yeh well none of us our experts (not even Dunston, he supports Chelsea!), and ones who know a lot, are not allowed to give out financial advice on this forum anyway.

Ask around with friends or family, see who they go to see (IFA wise) and then go yourself, see what they have to offer. Get a number of viewings with different ones (if you can), whichever one you find you can trust the most with your £50k, go with them. (and you can always post what they say on here and we can then tell you whats what)

Thanks, i didnt know that about not being able to give out financial advice....not having ever had much money, ive never been in this situation before....however, my question wasn't really what to do with or where to invest the money, as its already invested..., but was, if the growth rate fell below 1% (is this possible?), and the stated fees are 1.3%, per year per plan, after maturity (3,4 and 5 years respectively ), is it possible for me to get back less than the £50k (£12.5k, £12.5k, £25k)my brother invested for me.....

ANGLICANPAT

The simplest thing on your particular query is to ring and ask them what happens in that scenario .