Child - Standard Savings Plans
A tax efficient way to save
Know exactly what they’re going to get
Become a regular saver
Life cover means that the child’s estate will get the guaranteed sum assured on their death, plus any bonuses that have been added, if they die during the term of the plan and all contributions are paid up to date. If you’re paying in more than £25 a month into their plan then we may ask you to answer a few quick medical questions.
Any UK resident can invest in a Healthy Investment Standard Savings Plan providing the plan matures before they are 65.
You might consider this plan if you already have savings in a bank or building society and you are now looking to put some money in to an investment which includes life cover, has some risk but potentially higher returns and the proceeds of which are paid tax free.
You might consider this plan if you have already used the friendly society Tax Exempt Savings Plan limit of £25 per month and you want to invest more for the child in to a similar policy.
Save from as little as £10 per month or a maximum of £275 per month (If you are already using your £25 per month Tax Exempt Allowance).
You can have their Standard Savings Plan mature on a specific date, or simply select a term between 10-25 years, providing it matures on or after the childs 16th birthday.
Depending on the term you choose you should see this as a medium or long term investment.
If the Standard Savings Plan is in the child’s name then the proceeds will be paid to them.
Although the Standard Savings Plan grows through bonuses, bonus rates are not guaranteed and in exceptional circumstances could be nil.
If your circumstances change and you are unable to continue the payments they may receive back less than you have invested and in the first year they are unlikely to receive back anything.
Inflation will reduce what the proceeds of the policy will be able to buy in the future.
Tax rules can change at any time.
If you have any doubt whether this Standard Savings Plan is right for them, you should seek financial advice.
If you decide to save in a Healthy Investment Standard Savings Plan for them, you will be investing into our Ethical With-profits Fund, which includes a mix of stocks and shares, fixed interest bonds, commercial property and cash deposits. The mix of assets held changes over time.
Our Ethical With-profits Fund does not knowingly invest directly in companies in the alcohol, tobacco and arms industries and gambling and pornography providers.
The Society aims to provide a consistent return by smoothing the investment return to avoid volatile fluctuations in the value of your investment. Smoothing may not protect you against long term or sustained falls in the value of investments.
For further information on our Ethical With-profits Fund please click here.
A reversionary bonus is an annual bonus, which once added to your Standard Savings Plan, can never be taken away, providing all future premiums are paid.
It’s expressed as a percent of your guaranteed sum assured so it cannot be compared to a rate of interest.
These are the reversionary bonus rates we’ve previously applied to our Standard Savings Plan:
2016 – 1.25%
2015 – 1.25%
2014 – 1.50%
The level of bonus depends on investment performance, our expenses and our solvency margin over the previous year as well as the Board’s expectations of future performance. The level of bonus also reflects the capital and bonus guarantees. The rate of bonus can change every year and could in exceptional circumstances be nil.
All reversionary bonus rates are net of charges. The bonus rate declared is the bonus rate you receive.
Unlike declared reversionary bonus rates, which can never be changed, interim bonus rates can be increased or reduced by the Board at any point during the year. The current interim bonus rates are based on a prudent view of future investment performance, solvency and expenses over the year. Interim bonus is paid on policies paid out within the year on both full withdrawal and death.
For our current interim bonus rates please contact our office.
A terminal bonus is an additional final bonus which may also be added on maturity or in the event of the death of the investor. The rate of final bonus can be changed at any time or can be withdrawn altogether.
Life cover included
The Healthy Investment Standard Savings Plan includes life cover if anything were to happen to them during the term of the policy.
The life cover consists of the original guaranteed sum assured (this is based on the amount you choose to save for them and the term of the plan) plus any bonuses already added to their policy.
When you complete a Standard Savings Plan application form we will ask you a few medical questions on any current and previous health issues on the child. We will make an assessment on the details you have provided.
The agreed sum assured they receive when you take out a Healthy Investment Standard Savings Plan is the absolute minimum the child is guaranteed to receive at the end of the chosen term, providing all the premiums have been paid.
Every year we may add a bonus to their Standard Savings Plan to increase the guaranteed amount they will receive on maturity. The bonuses, which are decided by the Board, are calculated as a percentage of your original sum assured. Once a bonus has been declared and added to the policy it can never be taken away.
Bonus rates can change every year and could in exceptional circumstances be nil. They depend on investment performance and other factors.
When their policy matures they may also receive a terminal bonus to further increase their maturity amount. The terminal bonus isn’t guaranteed and can be increased, decreased or removed altogether at any time.
The level of bonus depends on investment performance, our expenses and our solvency margin over the previous year as well as the Board’s expectations of future performance.
The Key Information Document includes examples of what you might receive back based on different investment scenarios. It also helps you understand the nature, risks, costs, potential gains and losses of this product and to help you compare it with other products.
Download our latest Key Information Document for our Standard Savings Plan.
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Opening a Healthy Investment Standard Savings Plan is really easy.
If you have any questions now or whilst you are applying just give us a ring or send us a message and we will help you.