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What's an Investment Bond?:
An investment bond is a life insurance plan designed to provide growth or income, or a combination of both on a lump sum investment. When you invest, your money goes into one or more investment funds you choose. Investment experts invest the money on your behalf.
With profit investment bonds
With profit investment bonds provide you with the opportunity to benefit from investment growth in a wide range of assets, but without the uncertainty of daily fluctuations in investment returns associated with traditional stock market backed investments.
A Guaranteed Income Bond
A Guaranteed Income Bond (GIB) is a short-term life assurance contract guaranteeing a fixed income over a fixed term. The original investment is guaranteed to be repaid in full at the end of the term. The term is usually between three and five years, and the investment consists of fixed interest stocks. UK based GIBs are paid net of basic tax, which cannot be reclaimed even by non-taxpayers.
Unit Link Bonds
A unit linked bond is a lump sum investment plan that gives you access to various investment markets throughout the world, via a wide range of professionally managed funds. These funds have varying objectives and levels of risk.
Distribution Bonds
Distribution Bonds are designed to provide a stable and regular income. Distribution bonds pay a monthly, quarterly or half yearly or annual distribution of any income earned. They invest in a combination of house-hold name company shares and government stock, particularly index linked gilts, which guarantee a return above the rate of inflation.
Fixed Rate Bonds
With a Fixed Rate Bond, the rate is fixed at the start - so from the moment you make your deposit, you know exactly how much money your investment will earn. When you open your Fixed Rate Bond, you can also open Bond Plus - a direct access savings account offering an enhanced interest rate.
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