The Fall of With-profits Funds or Bonds

Posted by siteadmin on Thursday 26th of November 2015.

Many people have invested money in with-profits funds, and are tired of receiving disappointing bonus statements containing the same message: ‘It’s been a bad year.’

Evaluating individual with-profits funds
These funds try to lock people into an investment, and our advisers at Scottsdale MoneyWISE frequently prove that the value of this type of fund is declining. They can advise on alternatives – which is good news for investors! Just call us on 01908 226400 or email info@sc-mw.co.uk to kick-start your fund assessment.

Where did they come from?
With-profit funds were popular in the 1990s because they were regarded as low risk as they weren’t directly connected to stock market volatility. Unfortunately, the dotcom crash badly affected their value in the early 2000s.

In response, providers slashed return rates (bonuses) and introduced market value reductions (MVRs), which reduced the surrender policy values.

It has been estimated that more than 12 million people are with-profit investment holders in the UK. In June 2015, the Telegraph referred to with-profit funds as ‘dinosaur investment funds’ and included them in their list of ‘the five worst places to keep your money’.

Contact us

If you have money trapped in a with-profits fund and would like its performance to be assessed, or to explore your options, please contact us on 01908 226400 or email info@sc-mw.co.uk.

The value of the investment and the income they produce can go down as well as up and you may not get back as much as you put in.

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