Guaranteed Savings Plan

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• What does the money back guarantee give me?

  This is a stock market linked investment plan and as such, its value can go up or down during the term of the plan. Whatever happens, we guarantee that you’ll at least get your money back, when the plan ends, providing you have paid each and every monthly premium, for the full duration of the chosen plan term. This can be between 10 and 25 years.

  The money back guarantee does not apply if you cash in the plan before its end date. Neither does it apply if you die during the plan term. Please see the section entitled ‘What will I get back?’ below for details of what you’d get back in these circumstances.

  This product and its associated money back guarantee are offered to you via Teachers Provident Society Limited (our parent company). Teachers Provident Society Limited is a financially strong and well-capitalised company. In the unlikely event that we could not honour the guarantee (i.e. if the company was declared insolvent), you would be entitled to make a claim to the Financial Services Compensation Scheme. For insurance-based products such as our Guaranteed Savings Plan, 90% of the claim amount would be covered, with no upper limit.  

• Am I eligible for this plan?

  Yes – if you’re aged between 16 and 64.  

• How much can I invest?

  Choose an amount between £50 and £500 per month.

  Once you fix the amount, this cannot be changed so you must make sure you’re comfortable that you can afford to maintain the premiums throughout the plan term. You cannot take premium holidays. If you’re unable to pay into the plan, the plan will be cashed in early and you’ll get back the value of your plan. (Bonus units will not be payable if you cash in during the first five years). Please see the section entitled ‘What will I get back?’ for more information.

• How long can I invest for?

  Choose a term of between 10 and 25 years (but your plan must end before your 75^th birthday). 

• How will my money be invested?

  After charges (see below), your money will be used to buy units in the Teachers Provident Society Limited Unitised With-Profits Fund. Unit prices can go up and down so you might get more units in some months than in others. 

  The aim of the Unitised With-Profits Fund is to obtain steady long-term growth. This means investing in a range of equities (company shares), fixed interest bonds (both government and company), index linked bonds, property and cash.  

  If you'd like to know more about With-Profits, please click here.
  

• What is the matched premium incentive?

  To welcome you as a new member of our Society, we will match the first premium you pay into a Guaranteed Savings Plan – so if you put in £100, we’ll do the same.

  If you’re already a member, we’ll match your first two premiums, as a thank you for your loyalty.

  These matched premiums are added as bonus units, so their value can go up and down during the plan term. They only have a value after 5 years.

  Please see the section entitled, ‘What will I get back?’ for more information on matched premiums.   

• How risky is it?

  When choosing where to save or invest your money, it is important to weigh up the amount of risk you are prepared to take, in return for a potential reward.

  Generally, the greater the potential reward, the greater the risk of capital loss. The reverse is also true. The lower the potential reward, the lower the risk of capital loss.  For the avoidance of doubt, ‘capital loss’ means you get back less than you paid in.

   Each of our funds is matched to one or more of our risk profiles and is awarded a number of little mountains. We call these the Risk Rockies. The more Risk Rockies you see, the rockier the potential ride could be with this type of investment!  One Risk Rocky is awarded for very low risk investments and five for the highest risk investments.

  For more information on risk and reward, please read our booklet entitled Guide to savings and investment - risk and reward.

  The Guaranteed Savings Plan is invested in our With-Profits fund, which is graded as 2.5 Risk Rockies.

  Low to Medium

  You are willing to take low to moderate levels of risk. You are prepared to accept the potential for a relatively modest amount of capital growth in return for the greater security of your money. You understand that you could still lose money with on a With-Profits investment if you cash it in before the agreed end date. The with-profits fund invests up to 60% in equity markets (company shares) and property with the remainder in gilts, corporate bonds and cash. This makes it appropriate for a medium risk investor. Because our with-profits products all carry some form of capital protection, they are also considered appropriate for a low risk investor.

• What will I get back?

  At the end of the plan term

  When your plan ends, providing you have paid all your premiums throughout the term, you’ll get back the greatest of the following: 

  1. The value of your plan – number of units held multiplied by the unit price on the day the plan ends
  2. The smoothed value of your plan – number of units held multiplied by the average unit price in the 2 years before your plan ends. This is to protect you, should the value of your plan fall just before your plan ends.
  3. The Guaranteed Amount – the amount you have paid in during the plan term plus any matched premiums we added at the outset. This is to ensure that, as a minimum, even if the fund performs really badly, you’ll get all your money back, plus the full value of the matched premium incentive we offered you at the start. For example:  You pay in £100 per month, every month, for a plan term of 10 years; the minimum you will get back at the end is £12,100 (new member) or £12,200 (existing member).   

   

  If you cash in early

  If you cash in the plan before the agreed end date, the Guaranteed Amount will not be paid. You could get back less than you paid in if you cash in your plan before the end of the plan term. You will get back:

  • Up to the first 5 years: The value of all units your premiums have purchased. Bonus units (awarded via the ‘matched premium’ incentive) have no value if you cash in your plan in the first 5 years.

  • After the first 5 years: The value of all units you have purchased including bonus units.

  If you die before the plan ends

  If you die before the plan ends, your estate will receive the greatest of the following:

  • A return of all premiums paid as at the date of death, or
  • 101% of the value of the fund (the value of all units including bonus units). 

• What about charges?

  Charges apply to this Plan. These charges help cover our costs including our operating expenses, the cost of providing benefits on death and the cost of the guarantee.

  You can obtain a personal illustration in Get a quote. This will give you full details of the charges and how they affect your potential returns.

  Should you decide to invest in this Plan, you will receive a further personal illustration with your Plan documents.

• What about tax?

  • Corporation tax is paid within the fund.

  • Higher rate tax may be payable on gains realised on death, early surrender or at the end of the plan term.  In certain circumstances, entitlement to age-related personal allowance or certain tax credits may also be affected.

  This information is based on our current understanding of HM Revenue & Customs rules, which may change in the future and depend on individual circumstances. 

• What about membership?

  • When you take out a Guaranteed Savings Plan, you’ll become a member of Teachers Provident Society Limited.  

  • This enables you to share in any profits we distribute, for example, by way of extra bonuses added to your plan. (Such bonuses are not guaranteed).

  • It will also entitle you to benefit from the special incentives, reserved for members only, that we offer from time to time.

  • Once you’ve been a member for three years, you’ll become eligible to vote at our Annual General Meeting on important matters relating to how the company is run. 

• What next?

  • If you would like to apply for a Guaranteed Savings Plan, please click Apply now