With Profit Bonds

updated: January 22, 2010

With Profit Bonds were a very popular form of investment and over the last three decades many hundreds of millions of pounds were invested with the various life offices that offered such bonds.

Their popularity has not only waned but has turned into reverse, however, as the long bear market of 2000 to 2003 took its toll and product providers were forced to slash bonus payments, introduce large Market Value Reductions and, in many cases, withdraw from the market and close their funds.

Many investors in With Profit Bonds now find themselves in the unenviable position of holding an investment that is not growing in value, with no real prospect that the situation will change, and yet they will suffer a heavy penalty if they attempt to move their investment elsewhere.

Holders of existing With Profit Bonds are encouraged to go to their advisers to ask for a review of their bonds to see if they are still a suitable investment for them or whether their money should be reinvested elsewhere.

Some With Profit Bonds, however, continue to perform well and the predictions of the complete death of such bonds have been exaggerated.  There is now a small but noticeable increase in the number of new investments being made into such bonds with a small number of product providers who have shown that they can manage their With Profit funds successfully.

To obtain further information please click here for our pdf Guide to With Profit Bonds.