Prudential Investment Bond
Features
Minimum initial investment |
£5,000 |
Minimum additional investment |
£300 |
Invested in the Prudential With-Profits Fund |
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Flexible payments |
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Withdrawals |
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Tax benefits |
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The Prudential Investment Bond may be ideal if you're saving over the medium to long term (5 years or more).
Benefits
- Pay as and when you want to
There are several ways to save. Once you invest an initial single payment of at least £5,000 you can make any additional payments (of at least £300). Or you can save regularly with as little as £50 each month and top these payments up at any time (certain restrictions apply). You can also decrease your regular savings, if you need to, as long as they don’t fall below a certain level, or you could take a payment break. - Withdraw your money at any time
You are free to withdraw money at any time. But please bear in mind that the bond is designed to be held without withdrawals for at least 10 years for regular savers and at least five years for single payments. Note that certain withdrawals could be subject to charges or a Market Value Reduction and that restrictions apply to regular withdrawals, such as the minimum investment amount and the deferment periods from commencement. Please read the key features.
Any income or withdrawals taken will reduce the value of your plan. If the income or withdrawals are more than any overall growth achieved the value of your plan will reduce below the level of original capital invested. - Invested in our With-Profits Fund
In the With-Profits Fund, the value of your plan depends on how much profit the Fund makes and how we decide to distribute it. Note that the value of your fund may go down as well as up and you may not get back your full investment. The annual rate of bonus applied to your bond will depend on the value of your bond. - Tax benefits
Withdrawals, equivalent to 5% each year of the premiums paid, can be taken without any immediate tax liability. You also do not pay basic rate income tax or capital gains tax on profit from the bond. Note that there may be tax liabilities depending on your circumstances if you withdraw more than this and when you cash in your policy.This is based on our current understanding as at January 2010 of current tax legislation and HM Revenue & Customs practice, both of which may change without notice. The amount of tax relief actually received will depend on your individual circumstances.
- Smoothed returns
With-Profits funds benefit from a smoothing process that aims to provide you with steadier returns. With smoothing we hold back some of the investment returns in good years and use this to boost final bonus rates in the years where the investment return has not been so good, offering some protection against bad stock market conditions.
However bear in mind that smoothing will not stop the value of plans reducing if investment returns have been poor.
Read more about investments and taxation.
What will I get back?
What you might get back will depend mainly on the With-Profits Fund investment performance while your money was invested, our charges and costs, smoothing and features you choose and charges that may apply. Please note that the value of an investment may fluctuate and is therefore not guaranteed. Charges may vary in the future and may be higher than they are now.
Take action
- For more information on our Prudential Investment Bond speak to your financial adviser or you can read our key features below.
- Read our guide to investments.
