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Shepherds Friendly 5% 5 Year Fixed Rate Bond
Comments
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Cons
No access until end of term, unlike a cash ISA
Returns significantly less if bondholder dies before end of term
Tax treatment may change in the future
The tax treatment of any option, regardless of what is may change in the future. So, that is probably unfair to include in the "cons" column. However, the fact the gain is treated under income tax could harm those that are borderline in the receipt of means tested benefits or close to the next tax bandI am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
diystarter7 said:
Sorry, I too don't follow and just read about the "125k" covers by FSCS, how can that be when the guaranteed cover is only 85% the rest is don to circumstances/etc?dunstonh said:When FSCS compensation protection limit is £85000 ?????The deposit protection is £85,000. This plan is a life assurance. So, it gets 100% FSCS protection with no upper limit.Not just misleading, but false. Crooks. Complain to the FSCS.It is not false in respect of the FSCS. However, it is false in referring to itself as a 5 year fixed rate bond. It is not. It invests in their With-Profits fund under the insurance tax wrapper. Their key facts document does correctly refer to itself as a life assurance.
There is a possibility that the FSCS coverage in their terms is wrong but as it hasn't been tested either way, you cannot be sure. SCARPS used to advertise as having FSCS protection but when they started to fail, the FSCS found that only if the issuer failed would there be FSCS protection. If the market counterparty behind failed, then there would not be FSCS protection. in this case, Shepherds Friendly are the issuer but they say Royal London are the counterparty. But in this case, they say there would still be FSCS protection. They may be right. But their interpretation may be wrong.
ThanksThe FSCS has different limits for different types of products. There is no limit for qualifying insurance policies: https://www.fscs.org.uk/what-we-cover/insurance/Scroll down and expand "Insurance claims entitled to 100% payment" section0 -
An endowment policy cloaked as a fixed savings bond?
Ahm oot.0
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