Santander savings NOT covered by BOE 50K guarantee?

rl290

You need to be prepared for the risk that the FTSE falls, and you get no return on half your money. In that case, you will receive under 3% on the whole amount. Is this a risk you are prepared to take? 3years and 9months is such a short amount of time to look at an investment return that it's as good as making a gamble on the FTSE. Furthermore, if you do want exposure to the FTSE, be aware that this product wouldn't include the effects of dividends, which have been one of the greatest sources of returns....

Overall, this sounds dreadful. If you just want savings, go for the highest paying ISA that doesn't need a linked investment product. If you want investment exposure, there are better options.

R

magpiecottage

From your comments, Guy, I don't think you really understand the product.

That is not surprising because it seems quite complex but it doesn't sound suitable for you.

D1zzy

I ask this in ignorance ... but if you are going to put funds into an investment thats tracks the FTSE -isn't it better to go for 1 that gives the full increase rather than 4% pa (maybe). I saw one mentioned in the telegraph at the weekend from Carter Allen ('cept I've just discovered that its Santander by any other name)
"Capital Guaranteed Growth Plan 5 is a structured deposit and is designed to offer a return equivalent to 100% of any rise in the performance of the FTSE 100 Index after 5 ½ years, with no upper limit. However, if the Final Index Level has stayed the same or decreased at maturity, your Original Investment is returned."

PC_Gabriel_Kent

To clarify, Santander are covered £50k savings and £48k for investments per person. The 48k investment cover by the FSCS covers all investments so that includes GGP and GCP. Whatever the opinions on whether GGP or GCP are 'good' those telling the OP the investment is not covered by the FSCS are giving false and misleading info to the OP.

kinglewis

They are structured products which means they are not covered under the fscs. The cash element is covered under the £50k deposit protection scheme.. but the investment element is not covered by the additional investment scheme.

Here is an abstract from the website...

The guarantee that you will receive the money you invested and the minimum return at maturity is provided by Santander Guarantee Company, a wholly owned direct subsidiary of Santander UK plc. Investors in the plan are exposed to Santander Guarantee Company’s ability to pay which is dependent on Santander UK plc and its subsidiaries continuing to be able to meet their financial obligations.
The Investment Company will enter into financial transactions with Abbey National Treasury Services plc which are designed to generate the returns under the Plan. These financial transactions will not be secured.
In relation to the two risk factors listed immediately above, in the unlikely event that Santander UK plc were to collapse you may lose some or all of your money.

dunstonh

If you are within the cancellation rights period then its probably worth a go. The structured products they retail are awful. They are just cross subsidising the higher interest rate on the cash side with the awful terms on the investment side.

If you want to do 50/50 then there are better ways of doing it.