Savings & Investments

When it comes to savings, sound professional advice is all-important to ensure the right decisions are taken. Independent Financial Advisers must undergo a thorough training programme and rigorous examination before being allowed to advise clients and you'll be pleased to know that there are safeguards in place to ensure that you and your money are in safe hands.

Deposit Accounts

It is always advisable for everyone to have some savings on deposit with a bank or building society. This will allow you ready access to your capital and you have the peace of mind that your funds are secure. Often termed "emergency funds"; you will have access to your capital, for the unexpected expense, but you may simply want to save for a "rainy day".

No matter what kind of investor you are, it is recommended that you have a basic deposit account and IFA can determine the most suitable one for your individual circumstances. Higher rates are available on accounts where a certain notice period is required before your money can be withdrawn.

National Savings

National Savings are a secure, tax efficient means of saving and are guaranteed by the Government. There are a variety of different National Savings products under the titles of
Capital Bonds, Children's Bonds, National Savings certificates, First Option Bonds, Income Bonds, Index-Linked Savings Certificates, Investment Accounts, Ordinary Accounts and Pensioners Bonds.

Unit Trust and Investment Trusts

A Unit Trust is a collective investment vehicle that reduces the risk to your capital by spreading your investment around. By investing in a Unit Trust, you also have access to professional investment management, but without the high costs usually associated with it.

An Investment Trust is a company whose shares are quoted on the stock market and its sole activity is to invest in the shares of other companies. Like a Unit trust, its also collective investment that enables the smaller investor to take advantage of benefits, normally only available to larger investors.

Bonds

Investment Bonds are a way of pooling the investments of many individuals, which will enable the smaller investors to take advantage of benefits usually only available to larger investors.

A wide choice of funds is available offering varied investment opportunities and if so desired, it is possible to switch between funds at a reasonable cost.

The With Profit Bond is a lump sum investment and instead of being directly linked to the stock market, it grows through the addition of regular bonuses. It offers the potential returns of a stock market investment, whilst smoothing out the peaks and troughs of the market. In a good year, some of the profits are held back to compensate for a poorer year, so you should get a steady return.

Although you can usually cash the bond in on demand, most companies will charge you to do so, to discourage mass demands which might result from an intense and unpredictable market. You should also be prepared to take medium to long-term approach with this investment.

Distribution Bond. If you are looking for income, whilst attempting to avoid capital erosion, you could invest in a Distribution Bond. Distribution bonds are collective investments in which the investments of many individual investors are pooled, enabling the smaller investors to take advantage of benefits usually only available to larger investors.

Friendly Society Plans

These plans are very tax efficient and friendly society tax-except funds grow free of all taxes. The final maturity proceeds can also be taken tax-free, however due to these advantages the government restricts the amount that you can invest to £25 per month or £270 per annum.

Maximum Investment Plans

The plan offers links to a wide choice of funds and for higher rate taxpayers, they can be very tax efficient. At maturity the proceeds can be taken tax-free, which means that you effectively avoid any charge to higher rate tax.

The value of your investment may go down as well as up, past performance is not necessarily a guide to future performance.

The information on this site is for general guidance only. Foyle Financial is an appointed representative of the M & E Network Limited, which is authorised and regulated by the Financial Services Authority. The M&E Network is entered on the FSA register (www.fsa.gov.uk/register/) under reference 150643.