Shepherd Friendly S&S ISA - Is it worth it with the cashback?

Mudegg
Mudegg Posts: 9 Forumite
First Anniversary
in ISAs & tax-free savings
Hi,

I've come across Shepherd Friendly S&S ISA on Quidco.

If I sigh up to pay in £30 a month, I will get £90 cashback.

It does not state any fixed term, so I could withdraw when I get the caskback? (probably in 3 or 4 months after the first payment)

I've read many bad words about Friendly Societies, but just wondering in this specific case, if it work for me?

Also their info sheet for the S&S ISA is rather confusing, the example it gave on the costs for cash in after one year after £1000 investment is £451.35....but on their site it only says it has a 3% initial charge and 1.5% annual management fee. Really don't understand how they got this figure.




Has anyone here had their product before? Please could anyone advise if my plan will work?
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Comments

  • Alexland
    Alexland Posts: 9,653 Forumite
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    It's an opaque 'with profits' product which means the amount you get back at the end of a defined term (or if you cancel very early) is a bit of a mystery and they have the freedom to apply adjustments to the money they choose to return depending on the circumstances. Personally I avoid these types of product regardless of the cashback.
  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    Mudegg wrote: »
    I've read many bad words about Friendly Societies, but just wondering in this specific case, if it work for me?

    Our experience has been mixed. The worst have been OK-ish, the best excellent. It's worth checking what other benefits you get beyond the financial return on the ISA.
    Free the dunston one next time too.
  • masonic
    masonic Posts: 23,270 Forumite
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    Mudegg wrote: »
    Hi,

    I've come across Shepherd Friendly S&S ISA on Quidco.

    If I sigh up to pay in £30 a month, I will get £90 cashback.

    It does not state any fixed term, so I could withdraw when I get the caskback? (probably in 3 or 4 months after the first payment)

    I've read many bad words about Friendly Societies, but just wondering in this specific case, if it work for me?
    If the offer is anything like their own Love2Shop voucher offer, then the smallprint states you must invest for a minimum of 6 months. Based on their own projections, you are looking at a loss potential of ~30% over that period after charges, so perhaps you would pay in £180 and get back £150. But the £90 cashback would leave you in profit. Of course, that might not be the absolute worst case scenario, but on average you'd tend to do better than that.

    So it could work out well for you if you are comfortable with the risk of losing some capital. You'll need to check the exact T&Cs of the Quidco offer.

    Remember that this could prevent you from opening another S&S ISA elsewhere this tax year - unless you are able to transfer this ISA to a new provider (there may be a cost to do this).
  • Bighen10
    Bighen10 Posts: 5 Forumite
    First Post
    Just contacted shepherds friendly for a value of my account, they have applied a "market value reduction" & taking 10% of the money I have paid in. This is daylight robbery & I am disgusted with them. STAY AWAY from these crooks. Of course I have not accepted & will seek assistance from the financial ombudsman.
    BE WARNED
  • eskbanker
    eskbanker Posts: 30,993 Forumite
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    Bighen10 said:
    Just contacted shepherds friendly for a value of my account, they have applied a "market value reduction" & taking 10% of the money I have paid in. This is daylight robbery & I am disgusted with them. STAY AWAY from these crooks. Of course I have not accepted & will seek assistance from the financial ombudsman.
    BE WARNED
    Calm down, they're entitled to apply MVRs, as stated in their Ts & Cs, so they're not in breach of anything and FOS won't be interested.  Discussed further on another recent thread: https://forums.moneysavingexpert.com/discussion/6244368/provider-charging-a-fee-to-withdraw-money-from-isa-not-in-terms-and-conditions-when-i-opened-the-acc/p1
  • dunstonh
    dunstonh Posts: 116,358 Forumite
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    Bighen10 said:
    Just contacted shepherds friendly for a value of my account, they have applied a "market value reduction" & taking 10% of the money I have paid in. This is daylight robbery & I am disgusted with them. STAY AWAY from these crooks. Of course I have not accepted & will seek assistance from the financial ombudsman.
    BE WARNED
    They are not crooks and they have done nothing wrong.  It was completely your mistake that you went into an investment product where the value will go down as well as up.

    The FOS will reject your complaint as there is no wrongdoing and you bought without advice.   (i.e. you are responsible for reading the documentation and knowing what you are buying - which you clearly did not do).

    You should not go around accusing genuine firms of being crooks when it is you that is in the wrong.  They could take legal action against you for libel.
    I 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.
  • Eyeful
    Eyeful Posts: 340 Forumite
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    edited 23 February 2021 at 9:19PM
    This looks to me to be a friendly society. This sort of thing was useful when working people never had access to  shares as they do today. Looking at their website I cannot easily see what the charges are (this is always important!). What I can see are the words with " with profits fund in  Royal London Multi Asset Strategies Fund (MAST)". This suggests that there is some form of insurance involved. If this is anything like the friendly society investments  I have come across before, there will be large upfront charges deducted from the money you give them. 
    Because of the hefty up front charges, that I suspect will be deducted from the money you give them, I would be very     surprised if you make money if you come out after 3 or 4 months. This sort of thing with a friendly society is supposed to show you a profit after the long term (i.e.10 years). The £90 cashback will really be coming from the money you give them initially.
  • P3
    P3 Posts: 169 Forumite
    First Anniversary First Post Name Dropper
    edited 24 February 2021 at 1:09AM
    I have no problem with this MVR, but the 10% discount rate doesn't show on their website, its almost feel like they are trying to hide it, i only have few £££ invested from the Quidco promotion few years back, so I can wait patiently, can't imagine if someone have more money in their product need the money urgently.

    Plus the market has returned back to its peak from the covid drop-down, I can't see why the discount rate still in place

    Edit: look like whatever it is being invested are still making a loss.

    https://www.trustnet.com/factsheets/o/prnz/royal-london-multi-asset-strategies


  • dunstonh
    dunstonh Posts: 116,358 Forumite
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    can't imagine if someone have more money in their product need the money urgently.

    People who need money urgently dont invest in products designed to be held for 10-15 years.

    Plus the market has returned back to its peak from the covid drop-down, I can't see why the discount rate still in place

    No it hasn't.   UK equity is still below pre-covid levels.  WP funds tend to be UK equity heavy.

    I have no problem with this MVR, but the 10% discount rate doesn't show on their website, its almost feel like they are trying to hide 

    It may be 10% for you but it wont be everyone.  Someone who started after the drop wont have an MVR. Someone that started a year or so earlier wont have as much as 10% as an MVR.   It's not a figure that applies to every person as its based on the value of the underlying assets relative to your contributions and dates.

    I 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.
  • P3
    P3 Posts: 169 Forumite
    First Anniversary First Post Name Dropper
    edited 24 February 2021 at 3:54AM
    Totally agree, but the different is 1) you can sell at the market price Vs the other, you can sell at market price plus 10% reduction.

    Hence this is a terrible unfair product. Hey, why else would they offer such high cashback...... it is to lure people in.

    I have edit my post above to show the link and yes it is still in the red.

    I could be wrong but I believe this 10% is across the board for everybody.
    I enquired this last month without telling them my policy number so they have no idea how much and when I invested in, and quoted 10% just the above poster.
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