Shepherds Friendly S&S ISA - Quidco Cashback Offer £80-£305

dcs34

For those that interested Quidco are offering cashback on new customers to Shepherds Friendly Stocks & Shares ISA.

https://www.quidco.com/shepherds-friendly-stocks-shares-isa/?ucb=134e8e49b7fcf14652489c8fd498bb03

Cashback payable from £80-£305 with Quidco depending on your initial investment sum and monthly premiums, payable around 5 months after opening the account.

Not sure how long this offers been available or how long it will last in the current circumstances. What are people's experience of Shepherds Friendly? The website implies the S&S ISA has a 3% average historic return after all fees - is this fixed as it's been the same for 5 years! Very little out there generally to assess their performance and standing, although you'd hope Quidco have at least checked the latter!

SF also offer a Love2Shop voucher code worth £50 when opening a new plan. Not sure how that relates with Quidco's T&Cs "Cashback will not be paid in conjunction with any other offer, voucher or discount code unless listed on this page, or with any other discounts such as staff or student discounts".

Apologies if posted/discussed elsewhere - I did a search and couldn't find much talk on Shepherd Friendly. 

masonic

They do it every year. They cream off enough in hidden charges from their customer base in general (not necessarily from this product) to be able to afford some quite generous incentives. I certainly would not rely on Quidco evaluating the merits of this financial product, although I'm sure they'd drop them if they didn't reliably pay the cashback.

Alexland

Yup wouldn't touch a friendly society investment with a barge pole. Quidco and Topcashback often have offers from AJ Bell, Fidelity and L&G which offer better investment proportions. Or maybe even Nutmeg as long as you remember to transfer out after the minimum term.

dunstonh

Is the offer on the ISA or the Bonus plan (TESP)?
Often cashback deals from various providers is on the friendly society saving plan which went obsolete around 20 years ago.  They are usually expensive and inflexible.  Indeed, if an IFAs was to recommend one of these then there is a good chance that it could be considered a missale.  This is why you nearly always see them sold under offers direct to public nowadays (as it cant be a missale if you buy without advice).
This is on part due to the high charges they usually have, the inflexible contribution term and the use of WIth Profits funds which are virtually obsolete nowadays.  ISAs and pension (when used as a wrapper) trump the Friendly Society TESP in the vast majority of cases.

The website implies the S&S ISA has a 3% average historic return after all fees - is this fixed as it's been the same for 5 years!

Your interpretation is not quite correct.   That is just the annual bonus.  It is a low rate, as you would expect from an annual bonus.    The bulk of the returns will be handled in the final bonus (which accrues as you go along).  However, the provider can reduce or remove the final bonus during negative periods.  For example, many people in With Profits funds from across the marketplace would have seen their final bonus reduced or removed fully over the last 2 months or have Market Value reduction imposed.  

The charges are usually the problem with this style of plan.  I typed that before looking and I see this is no exception.  I viewed the KID and it shows 0.22% initial charge on contributions and an ongoing charge of 2.37%.   (Note, the charges disclosure is not transparent as it shows the figures only as a Reduction in yield (RIY).  Rather than the explicit rates.   e.g. on a 1% annual charge, the RIY would be 1.1%.

A more modern ISA on a platform using one of the many popular multi-asset funds would be under 0.50% p.a. with no initial charges.

This being a consumer site, the focus is often on charges.  However, it should be noted that plans that target low contribution levels do tend to be more expensive when looking at percentage terms as people with higher amounts will not typically use them and will not be there to cross-subsidise the smaller investors.   So, from a business point of view, the higher charges are entirely logical because of the typically small amounts that would be involved.    Plus, all these cashback and gimmicks need paying for and the investors effectively pay back what they are given in those higher charges (I am not a fan of cashback on investments.  Why not just lower your charges and be more transparent? -  again, from a business point of view, I can see why they do it.  You would probably never have considered it without the gimmick).  

As this is a consumer site, you will find the comments will favour the much more modern low cost options (where charges are explicit and lower and investment data is published on independent sites like Trustnet or Morningstar)

Very little out there generally to assess their performance and standing, although you'd hope Quidco have at least checked the latter!

I think you are very naive if you think that!

Sometimes with Quidco, you can play the game and pay into a product just long enough for the charges not to exceed the cashback.    However, you need to be very careful if you try that as some of these old fashioned investments plans have exit charges.

ecnirp98

I was looking at this myself, just got the Quidco email:
£220 cashback for a genuine new Stocks & Shares ISA application with a monthly premium of £100 - £999.99.

With the interest rates so poor at the moment on Cash ISA/savings accounts, I was look at opening a S&S ISA, so this caught my eye,. as I was planning to pay in around £200 a month, so for putting in £2400, I would get £220 cashback irrelevant of S&S ISA performance, so around 10%, so seemed a good deal to me with low risk on a relatively small amount of money with a decent return compared to cash savings and I can transfer to another S&S ISA in a year of I want? am I missing something?

grumiofoundation

Thread from a month or so ago. 
https://forums.moneysavingexpert.com/discussion/6126934/shepherds-friendly-mvr-warning

As above when signing up for products offering cashback, it is even more important than usual to check Ts and Cs for smallprint, check the Ts and Cs of the cashback, minimum investment terms, exit charges etc

ecnirp98

Thanks for the heads up grumiofoundation , I did search the forum, but the quidco article was the first one I read and looked related to my question, the Quidco T&C's looked ok for qualifying for cashback, as it is an S&S ISA it is not like a long term plan, but I will check abit more, hiding the MVR as they appeared to is abit naughty and makes me wonder if I would want to deal with them, I guess there must be a reason for the big cashback as they must make their money back another way !!!