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?
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?
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.
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