monthly savings schemes

WOOLLY_BULLY

Hello.
Anyone any thoughts / ideas / advice on these monthly savings schemes ranging from £20 - £100?
Is there a better way way to invest £20-£30 monthly for 10 years or so?
Are some schemes better than others?
Are they 100% safe?
Is there anywhere I can look for advice?
Thank you in anticipation. Finance is not my strong point!!

dunstonh

What monthly savings schemes are you talking about?

The AXA "Carol Smilie" Plan? - avoid like the plague.
Any fixed term 10-15 year plan? - avoid like the plague (exception is higher rate tax payer who has used ISA allowance, why MAY find certain MIPs acceptable)
Equity ISAs? - tend to start at £50pm and very acceptable if the investment fund matches your attitude to risk. Best to have safe money put aside before you look at these.
Cash ISAs - Risk free (providing the interest rate beats inflation and you do not have more than the deposit protection scheme limit)

WOOLLY_BULLY

I was largely referring to Axa type schemes as they seem simple and safe.
ie £20 monthly for 15 yrs - input £6480, output with 4% growth £7420, and about £5000 life cover to boot. However guaranteed minimum return is £4598.
Doesn't seem a lot of profit, and I might actually lose money, but I guess it does build up over the years and £20 is affordable for me. Standard Life and other companies that are struggling with promised returns on endowments mean that perhaps they are not as safe as they suggest!
Thanks. I appreciate your input.

dunstonh

Endowments have a guaranteed minimum sum assured and that is the only guarantee.

There is a lot of misinformation about endowments. A stockmarket crash happened a few years back and any investment with stockmarket backing is going to be down after the crash. It doesnt make all these companies unsafe. For example, I obtained a projection on a Standard Life endowment last week and the shortfall was just over £1000 less than last year.

However, through all that misinformation, one thing is clear. Endowments are history. Lower charge, more tax efficient products are available. No financial advisor would be recommending an endowment now. Most companies have withdrawn their endowment product. AXA, on the other hand, still sell it. However, if you buy it from an advert then you have only yourself to blame and there is limited liability to AXA (although they were fined by the FSA last month because of false advertising on this plan).

There is a thread on the AXA plan in this section which is a few weeks old. I suggest you take a peek at that for more information.

The AXA bonus rate is lower than the 4% projection. Indeed, when you take charges into account, if you got the current bonus rate for the whole term, would give you less than you have paid in.

With £20pm, i would suggest you look at Cash ISAs.

WOOLLY_BULLY

Thank you very much.