Standard Life has left bonus payouts on with-profit bonds, homeplans and stakeholder policies unchanged however final bonus rates have been reduced on remaining products.
A statement issued by the firm this morning say all annual bonus rates remain unchanged but final rates have been cut on other with-profit products “to reflect more closely actual long-term investment returns”.
Although rates have been cut, evidence presented by Standard Life suggests life and pension with-profit policies may still offer a better return than other investment options such as the average deposit account or equity investment.
At the same time, however, Standard Life reveals the investment return on with-profits policies was just 2.4% to June 30th, 2004, as the firm now has just 35% of its assets held in equities compared with 41% in fixed interest, 9% in cash and 15% invested in property.
Mortgage endowments now maturing – ie 25-year endowments – are thought to have generated a maturity value of £54,975 or 9.3% annualised return on £15,000 in premiums paid.
|Type of investment (25yrs, £50 a month)||Total payout||Annualised return|
|Standard Life with-profits endowment||£56,873||9.5%|
|Average building society account£26,016||4.2%|
|Average UK equity unit-linked life policy||£46,596||8.2%|
|Average balanced managed unit-linked life fund||£37,658||6.7%|
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