How can I find and compare Friendly Society performance?

Freecall

dunstonh said:

Looking into friendly society investment bonds for a lump sum.

That is something you don't see every day!

I thought that my interweb had time-slipped into the '70s.

No idea they still existed.

jouef

dunstonh said:

... I suspect you have limited yourself to obsolete and old fashioned investments and lack the broader whole of market knowledge.

On the contrary, I invest in cash, S&S, AIM, P2P, crypto, non-correlated assets, co-operatives and crowdfunders. I have made substantial gains and spectacular losses. I tend to avoid individual shares though. And no gearing, ever. My approach is mostly very long: hold, wait and watch. The FS ISAs I mentioned are on about 9%pa (15 years) and 7% (12 years), each started at the £500 maximum [edit: wildly inaccurate guesses - correct figures posted below]. Two or three more are not far behind. My FS endowment outperformed the market even after it crashed, due to a guarantee in the small print. And my small FS pension did well though I don't have the details to hand.

jouef

jimjames said:
I suspect the only place that would have that information is on the provider's website and if they don't have it then it may not be available at all.

Thank you for answering the question!

jouef

artyboy said: If there was a FS that offered more transparency over fees and investments, then even if fees were higher, it could be worthwhile. But I've not spotted one yet. Actually wondering if they are missing a gap in the market...

Agreed; I’ve used a wealth manager whose high fees are slated in the press. But their returns consistently beat lower-charging rivals, are levied in arrears rather than reducing the investment, and include services others would charge for like writing in trust. But without any performance data, I can’t make the same calculation for friendly societies except for a few fixed-rate products. As an aside, they may be positioned for an interesting role in the monetised healthcare system we are heading towards.

dunstonh

Agreed; I’ve used a wealth manager whose high fees are slated in the press. But their returns consistently beat lower-charging rivals, are levied in arrears rather than reducing the investment, and include services others would charge for like writing in trust.

That cannot be the usual wealth manager we see often slated as their funds tend to be relatively poor or average performers.     Plus, waiting policies in trust, on the rare occasions it is needed, is pretty much at no additional cost across the board unless you go to a firm that has a menu style tariff. 

jouef

Limited data from my own experience, 2022 figures: four Friendly Society ISAs over 20-22 years have returned 6.08%pa, 3.44%pa, 3.43%pa and 3.36%pa (inflation 2.4%pa). In the 2000s, my old FS endowment returned approx 1.8%pa, due to a guarantee in the small print, while some of the market was negative due to the crash. The FS pension plan I had is hard to work out, but I’m guessing achieved in excess of 10%pa.

jouef

dunstonh said:

That cannot be the usual wealth manager we see often slated as their funds tend to be relatively poor or average performers.     Plus, waiting policies in trust, on the rare occasions it is needed, is pretty much at no additional cost across the board unless you go to a firm that has a menu style tariff. 

My actual results over ten years are: charges 2%, returns consistently >6% net of charges, on a low-to-medium risk basket of funds. They have dealt with amending a pre-existing trust, tax accounting and advised outside the investment within their charges. The level of investment is at the lower end of medium for them.

Eyeful

Any business (FS included) which can consistently out perform others or has lower charges than the competition will shout about it. That is just human nature.

If you can not easily find out about outperformance, it is because that product is average or below average in performance. They may then employ a PR firm to put a good "spin" on the information

If you can not easily find what you are being  charged for a product, it is because you are being charged a lot for that product and they hope you will give up on trying to find out. 

So if you are looking for any type of financial information and you find it is either hard to find or even non existent the chances are high that it is because that it will shown the company, organisation, or sector in a poor light. So they either ignore it, bury it or make it hard to find

Albermarle

Eyeful said:

Any business (FS included) which can consistently out perform others or has lower charges than the competition will shout about it. That is just human nature.

If you can not easily find out about outperformance, it is because that product is average or below average in performance. They may then employ a PR firm to put a good "spin" on the information

If you can not easily find what you are being  charged for a product, it is because you are being charged a lot for that product and they hope you will give up on trying to find out. 

So if you are looking for any type of financial information and you find it is either hard to find or even non existent the chances are high that it is because that it will shown the company, organisation, or sector in a poor light. So they either ignore it, bury it or make it hard to find

I looked at the Shepherd's Friendly website. All I could find is that there were two with profits funds ( one green one and one not). There was no past performance info, or at least I could not find any.
Not sure how they get away with it as for mainstream investment funds they have to disclose it.

jouef

Eyeful said: So if you are looking for any type of financial information and you find it is either hard to find or even non existent the chances are high that it is because that it will shown the company, organisation, or sector in a poor light.

Albermarle said:I looked at the Shepherd's Friendly website. All I could find is that there were two with profits funds ( one green one and one not). There was no past performance info, or at least I could not find any.

It is indeed strange that Friendly Society returns are rarely, if ever, disclosed by them or reported on by commentators. I like to invest on a fully-informed basis (though within that I am happy to take on extreme risk). Equally, the oft-repeated warning ‘high charges and low returns’ cannot be based on figures that are not disclosed. Such a claim ought to be properly backed up with references or data but never is (it is not enough to supply a list of charges without the context of the accompanying returns, or criticise the business model without showing its performance). There is anecdotal evidence of poor returns from customers’ comments, at least some due to them misunderstanding the product or the market (for example complaining about a MVA during a slump), and positive remarks also appear. I have been pleased with my own long-term FS returns - inflation plus about 4%pa on average.