Cautious Managed Growth ISA

The money you invest in the Cautious Managed Growth ISA is placed in the Cautious Managed Growth Fund and invested across a wide range of assets - see our Cautious Managed Growth Fund fact sheet to find out which assets your money is invested in and fund performance to see how it has performed.

• Apply direct and pay only 1% standard initial charge.
• Invest a lump sum from £500 to £7,200 (subject to your ISA allowance), or get started with a direct debit from as little as £50 a month. Note that from 6 October 2009, if you're aged 50 or over, before the end of the current tax year (5 April 2010), you can invest up to £10,200 into a stocks and shares ISA.
• Charge free withdrawals of £250 or more are allowed at any time, although please bear in mind that taking income or making withdrawals may affect the returns you get back on your investment.
• Annual Management Charge of 1.35%.

• You can top up an existing ISA up to the annual limit by either calling us free on 0800 072 6159 or using this top up form (the minimum lump sum is £250 and you can top up your monthly payment by multiples of £5).

• Transfer previous years' cash or stocks and shares ISAs without affecting the current year's limits with this Transfer and Authority Form. Your current ISA Manager may charge you for any transfer. You may also lose out on any growth in value during the period where the transfer is taking place between your old ISA Manager and Prudential.
• You can switch funds whenever you need to with no charge. Note that charges may vary in the future.

It's true that putting money in shares and other assets is more risky than investing in cash, and events over 2008 have gone a long way to showing this. However, historically, over the medium to long term, the returns from shares have been better than cash.

According to the Office for National Statistics (Financial Statistics) Rates Shares and Deposits - Average Rates, from the launch of FTSE All-Share index in April 1962, to June 2009, shares have beaten cash in:

• 77.5% of all 5-year periods
• 94% of all 10-year periods

So if you're thinking about building a portfolio of savings and investments over the longer term you might consider investing a portion of your money in shares depending on your attitude to risk.

Past performance is not a reliable indicator of future performance. The value of your investment may fluctuate and is therefore not guaranteed. You may not get back the full amount of your investment.

This is a higher risk investment than a bank or building society. In a bank or building society your money is generally secure and readily accessible.

Read more about why you might consider investing in shares and not just cash.

Multi-asset investing
We invest up to 60% of the Cautious Managed Growth Fund in stocks and shares to try and take advantage of higher returns over the longer term but the fund does not invest all of its money there. This is because by investing in other assets, such as bonds, cash and property, the fund is not solely exposed to significant price movements in any single asset. With this approach, rather like putting all your eggs in several baskets, the fund aims to smooth your returns when markets are volatile.

There are some tax advantages to investing in stocks and shares within an ISA wrapper. Apart from the 10% tax credit applied to dividends, there is no additional income or capital gains tax liability, either within the ISA or for individuals.

Please be aware that the impact of taxation (and any tax reliefs) depends on individual circumstances. Current tax rules are valid until 5 April 2010 and are likely to change in the future.

Find out more about investment and taxation.

What does the investment calculator do?
This easy-to-use calculator gives you an idea of the returns you might get if you invest in the Cautious Managed Growth ISA. Before you use the calculator please read the assumptions and risks.

To get started
Simply input the amount you want to invest, select per month or per year, choose investment term, and then press calculate.

Investment calculator assumptions
We have made several assumptions in creating the investment calculator.

We assume a growth rate of 7% a year, which is the median return for tax-efficient investments as specified by the Financial Services Authority, and that income is reinvested. The projected returns also take into account several charges - see the key features for more on these.

Investment calculator risks
The aim of this investment calculator is to show the projected investment returns based on the assumptions above but you could get back less or more than this and you may not get back the full amount of your investment.

The calculator results are future projections and are for example purposes only. Such forecasts are not a reliable indicator of future performance.

• A rising rate of inflation will have the effect of reducing the actual value of any gain by an equivalent amount.
• The calculator is based on current tax rules, which are valid until 5 April 2010. These may change in the future.

Our fund manager actively selects assets the fund should buy or sell. You will have years of successful Prudential fund management experience behind your investment.