Your Money: Readers' Lives

Unit-linked life insurance ... pension policies ... Halifax shares. Your everyday financial queries answered

I am paying pounds 25 a month into a unit-linked life insurance savings policy. The last annual statement shows how many units are bought each month, but there is no information on how much interest is paid on the amount already invested. Can you comment?

DW, Surrey

Financial statements from insurance companies and other investment managers could certainly be made more user-friendly. The information included in your 1995 statement is fairly typical.

The statement, broken down into 12 monthly entries, shows how much is invested in the plan. The monthly investment is less than your pounds 25 premium. There appears to be a monthly policy charge - money taken by the insurance company which is not invested. A more useful annual statement would explain this clearly, although the information will be found (possibly buried) in some of the literature you have received in the past.

Next you'll find the price of buying the units each month and how many units your monthly investment bought at that price. You divide your monthly investment by the unit buying price to get the number of units bought. The buying price of the units grew throughout 1995 - reflecting the good performance of the stock market - so there was a corresponding fall in the number of units bought with the same monthly investment.

Your investment return comes through the rising value of the units rather than a separate interest figure. Your statement shows the total number of units you have bought over the life of the plan and how this builds up each month. The current value of each unit is found in the bid price - the price you'd get if you cashed in. The bid price is lower than the buying price. (The life insurance company pockets the difference.) Simply multiply the number of units held in the plan by the current bid price and you get the current value of the plan.

I have two pension policies and both seemed to rate somewhat poorly in recent reports about pension plan charges. Should I transfer them?

RW, Hampshire

You've only just started one of your plans and if you have doubts about it you may have to cancel it and lose the first month's premiums, rather than being able to transfer it. As for the other one, transfer now and you could be shutting the stable door after the horse has bolted. It has a current value of more than pounds 23,463, but its transfer value is pounds 22,759. So you would lose 3 per cent of your money on the transfer and would lose further money with the cost of buying into another pension plan.

You may come to the conclusion that it is worth taking a loss now as this could be more than made up by better investment returns and a more favourable charging structure elsewhere. But this is not a decision to be taken lightly. You need expert opinion on whether your current plan has performed badly (which may not be the case at all) and the prospects if you keep your money where it is compared with transferring it elsewhere.

A lot of money is at stake and you should be prepared to pay a fee (at a rate of pounds 60 to pounds 100 an hour) to a pensions specialist to consider all your pension options. Contact the Society of Pension Consultants, Ludgate House, Ludgate Circus, London EC4A 2AB (0171 353 1688) for a list of advisers.

Nine million people are up for free shares from the Halifax. But even though I've had a Halifax Cardcash account with pounds 100 in it since 1989 the Halifax says I'm not eligible. What's gone wrong?

MP, Peterborough

The facts of the case seem clear cut. You opened a Cardcash account in 1989, depositing just pounds l00, in the hope that you would benefit if the Halifax were to convert into a bank. You have not used the account at all, simply leaving your pounds l00 to accumulate interest.

Unfortunately, the Cardcash account is a deposit account, not a share account. The distinction between a deposit account and a share account is a legal one. It is lost on many building society savers (and certainly was back in 1989). Deposit accounts do not bring membership of the society nor the entitlement to vote on any conversion proposals. With a share account you are entitled to vote - and therefore are more likely to be offered a windfall to convince you of the virtues of demutualisation.

That said, there are many grey areas concerning who qualifies for windfalls. Savers (and borrowers) who have been told they won't qualify for a handout shouldn't necessarily give up the fight - especially if they stand to lose out because of poor advice or administration by the society. But your case does not seem worth contesting unless you maintain that you specifically asked Halifax staff for a share account back in 1989 - and can prove it.

q Write to Steve Lodge, personal finance editor, Independent on Sunday, 1 Canada Square, Canary Wharf, London E14 5DL, and include a telephone number.

Do not enclose SAEs or any documents that you wish to be returned. We cannot give personal replies and cannot guarantee to answer every letter we receive. We accept no legal responsibility for advice given.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Experienced Recruitment Consultant

£20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

Day In a Page

Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
Tourism in Iran: The country will soon be opening up again after years of isolation

Iran is opening up again to tourists

After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there
10 best PS4 games

10 best PS4 games

Can’t wait for the new round of blockbusters due out this autumn? We played through last year’s offering
Transfer window: Ten things we learnt

Ten things we learnt from the transfer window

Record-breaking spending shows FFP restraint no longer applies
Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

‘Can we really just turn away?’

Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

Nine of Syria and Iraq's 10 world heritage sites are in danger...

... and not just because of Isis vandalism
Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

Girl on a Plane

An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
Why Frederick Forsyth's spying days could spell disaster for today's journalists

Why Frederick Forsyth's spying days could spell disaster for today's journalists

The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent