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Axa with-profits bond goes for income

Axa Sun Life is aiming its with-profit income bond at the IFA market.

The bond is a variation of it&#39s existing with-profits bond, but has a higher annual bonus rate at 6.25 per cent. The existing bond currently offers an annual bonus rate of 5 per cent. However, investors will get a lower terminal bonus than those who invest in the existing bond.

The with-profits income bond is designed for investors seeking capital growth and regular income, perhaps during retirement, who would otherwise need to make withdrawals from their original capital.

Investors can still make regular withdrawals if they need to, but if they withdraw more than 7.5 per cent of the bond&#39s value each year during the first five years, they must pay an early surrender penalty.

The penalty incurred depends on which charging structure investors choose. Under the five year plus charging structure, they pay 7.5 per cent in year one, which reduces to 1.5 per cent in year five. If they choose the limited access charging structure, they pay 5 per cent in the first year, which reduces to 1 per cent in year five.

This bond could be a useful option for investors who do not want to be fully exposed to the stockmarket, but they may be wary of with-profits bonds after witnessing some providers cutting annual bonuses as an effect of recent stockmarket turbulence.


Parsoli UK – Parsoli Global Islamic Equity Fund

Friday, 10 August 2001. Type: Oeic. Aim: Growth by investing in blue chip international stocks through Shar&#39iah. Minimum investment: Lump sum £1,000, monthly £50. Investment split: 100 per cent blue chip international funds. Isa link: Yes. Pep transfers: Yes. Charges: Initial 5.75 per cent, annual 2 per cent. Commission: Initial 3 per cent, renewal 0.6 […]

The Daley Update

Schroders is to raise the annual charge on six of its unit trusts –Schroder Pacific, Tokyo, UK equity, income, gilt & fixed interest andEuropean – by 0.25 per cent to 1.5 per cent from November 21 Lincoln Unit Trust Managers is offering discounts of up to 4.75 per centon its unit trusts and Isas until […]

Sir Brian Stewart to chair Standard Life

Scottish & Newcastle chairman Sir Brian Stewart is to become the new chairman of mutual life office Standard Life.Stewart, 55, will replace the current chairman John Trott who is expected to announce his retirement at Standard&#39s annual meeting next April.Known as a strong defender of mutuality, Stewart is expected to resist any further attempts to […]

Teacher&#39s add up discount

Teacher&#39s Building Society has introduced a five-year discounted rate mortgage that is available for loans of up to 95 per cent of valuation.The movemaker mortgage plan has a 0.75 discount for the first five years, giving a current payable rate of 5.99 per cent. There is no arrangement fee and borrowers who redeem during the […]

Creating opportunity out of change

By Denise Wond, marketing manager The buy-to-let market has recently been the subject of a raft of tax changes, all of which make it a less profitable and less appealing proposition for investors. In response, we’ve seen a dip in demand for BTL mortgages and that’s bad news for many advisers who will now be looking […]


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