ReAssure with profit Funds

Imnoexpert_2

Elderly Relative has received letter relating to their "Unitised-With Profit Life 20 Life Accumulator Series" investment. They seem to have 10 lots of units. These currently have a MVR (2.5%?). The statement shows a Final  (not guaranteed) bonus which is included and seems to be worh about 40% of the total value. The 'Regular Bonus' added in February 23 was 2.25%. The policy incudes a death cover which is a little higher than the current amoun the policy is 'worth'.  I think it is a legacy LG fund.

Re-Assure have included a list of four new funds ('could save you money') at 0.85% amc.These are 'deposit (life)', corporate bond (life), mixed investment (life), Uk and global equity tracker (life)

They suggest comparing the existing funds to the new funds, which I have struggled to do. There is also a big warning that If you are currently invested in a unitised with profits fund (which I presume he is) switching may not be appropriate as you may lose valuable benefits. The letter refers you to the 'Your funds section, of their website which then bounces you to the with profit section for LG, which seems to hark back to 2022 and is very unhelpful.

My hunch is that this investment is quite, poor, very old fashioned, and has high charges, however may not be worth messing with. I cant find the info. I need on the website (even if I understood it) to make a decision.

I'm not confident that ringing them will help, and I'm not confident that relatives IFA is going to want to look into this 'old' investment with any enthusiasm. Nevertheless I guess this is the way forward.

Can anyone help with any suggestions about what to do next or what information I can find out? This seems a very complex decision. I bet there are tax implications too!

Albermarle

With Profits funds were popular in the past but less so now.
They basically try and smooth the ups and downs of the financial markets, by keeping back profits in good years to subsidise bad year. So you could say they are a bit boring/old fashioned and often with relatively high charges. On the other hand you could say they are reassuringly steady as she goes.
The Final bonus is never guaranteed but normally pays out.
Otherwise it is difficult to be sure if it is worth changing them or not.
Is this fund is part of a pension, or not?

fwor

It would be useful to ask your relatives to dig out the documentation that was provided with the product. Unless it's very old, it should have come with extensive information on partial withdrawals and the associated tax implications.

And... if they are already paying for the services of an advisor (assuming that they are, because it's an IFA), it may help if they hint to their advisor that they would value the amount of "enthusiasm" that he/she puts into helping them to understand what alternatives they might have. If they really are "unenthusiastic" then perhaps now would be a good time to seek out a different IFA?