Investors Trust S&P500

Investors Trust S&P500 Savings Plan: What is it?

The S&P500 family of savings plans enable investors to save over 10, 15 or 20 years into the S&P500 index. The returns are linked to the performance of the S&P500 index but there is also a built-in guaranteed return as well. They are unit-linked savings plans designed to help investors save for the future, subject to low minimum premium levels.

What’s the investment choice?

You can only invest into the S&P500 Index in USD. You just have to choose the term that suits your goals. The S&P500 index is made up of the largest 500 companies in the USA.

As it is a unit linked regular savings plan, the Investors Trust S&P500 is susceptible to market risks on the underlying funds themselves. However, the guaranteed returns of respectively 100% at 10 years, 140% at 15 years and 160% at 20 years take away the worry of large market movements as you near maturity. It also allows you and you adviser to easily target specific goals, such as an educational need or a retirement shortfall.

Is the Investors Trust Evolution multi-currency?

The S&P500 Plans can only be denominated in US Dollar.

Investors Trust S&P500 plans: Minimum Deposit you can contribute?

$/GBP/Euro 200 per month for the contractual term of the plan. The minimum term is 10 years up to a maximum of 20 years for the contractual plan.

What if I need access to the money early?

On the S&P500 savings plan, there is limited accessibility without impacting the benefits of the plan. If premiums are reduced or stopped (for more than 90 days) or a partial surrender is taken during the term of the plan, then the guaranteed return will be lost. A client could choose to take a full early encashment, but then penalties will be applied through surrender charges linked to the term of the policy.

In effect, this means that S&P500 savings plans will have a low surrender value during the early years.

What are the fees and charges on an Investors Trust S&P500 savings plans?

For the S&P500 savings plans a charge of between 1.1% and 2.0% each year is charged to the premiums expected and based on the value of the initial units, it is deducted monthly and is based on the term of the plan.

There is also a Policy fee of $10, which will be deducted in arrears from the policy.

There is a Yearly Structure fee is charged: this charge is based on the policy value and will be deducted on a monthly basis at a rate of 1.5% each year.

There are no other underlying fund charges.

What about discounts or bonuses available?

Investors Trust S&P500 plans give you a welcome loyalty bonus when you maintain your contributions for more than 10 years. You can earn a loyalty bonus after 10 years of 7.5%, and a further 7.5% after 15 years on the new premiums paid and 5% after 20 years. This gives your savings a regular boost.

The loyalty bonus and the maturity bonus are dependent on all expected regular premiums being received.

Main considerations before committing to an Investors Trust S&P500 savings plan

The Investors Trust S&P500 savings plans are recommended by traditional financial advisers as an ideal savings product for people who want to save to reach a financial goal.

You should be aware that they are contractual plans with a fixed term to the policy, so if you surrender early you may get back substantially less than you actually invested, due to early encashment penalties. It is not intended as a short-term plan. You should not invest in such a plan if you may need the money for short-term financial goals. You should also not commit to saving a high monthly premium if you are unsure whether you will maintain that level of premium for the duration of the plan, as fees will depend on your initially agreed premium.

If you do require more flexibility to the term of the plan and to the premiums that are paid each month, or to where the money is invested, then the Evolution savings plan range from Investors Trust may be a better option for you.