Temp – Holding our nerve through uncertain markets

24.03.2021 by Jim Ker

It’s no secret that markets are currently feeling the pressure due to the global outbreak of Covid-19. According to Which, the UK Stock Market has fallen much faster than previous shocks, sparking widespread reports that a global recession may be on the cards. It’s easy and understandable to see how this could make many savers worried about their money and look at making some rather big financial decisions – shifting the direction of their long-term investment plans. But whilst it’s wise to consider your options in these uncertain times, hasty moves when it comes to savings and investments could do more harm than good.

“There are only two prices that count. The price you buy at and the price you sell at. What this means is that when markets are down it only matters to those that need to cash in their policies early.” 

(The Martin Lewis Money Show – A Coronavirus Special Episode)

At Kingston Unity, we deliver long-term savings and investment solutions for our Members. When we say long-term, we’re talking five years as a minimum, usually longer. When we invest the Society’s With Profits fund, we are seeking a medium to low-risk investment with the aim of achieving a return over the long-term. We achieve this by investing in a range of different assets, including equities, property, Bonds and Gilts, and cash. It is these fluctuations in market volatility that our With Profits fund has been designed to weather and we’re very confident that we are remaining robust throughout these unchartered waters. Many of our products also offer guarantees on your initial investments.

 

Looking Long Term

In times of market downturn, context is important. Although the market is currently feeling the impact of Coronavirus (Covid-19), 2019 also saw the UK Stock Market grow by 12% over the course of the year.* This shows the need to look at long-term investments with exactly that in mind – the long term. In addition to that, we are beginning to see markets steady, according to this article in Which. While this is no excuse for complacency, it does show that rash decisions may not be the best moves when it comes to our finances.

To help our Members who are investigating their options, we’ve put together some recommendations to help savers keep calm, carry on and remain confident in their investment decisions:

1. Don’t Panic

These are scary times, but as we mentioned above, now is not the time to be pulling all your money out of savings accounts and sticking it under your mattress. Financial institutions across the world are experiencing the same situation and withdrawing your money or transferring it to another provider could do more harm than good to your long-term savings plans. Kingston Unity has made a number of key strategic moves for the benefit of the Society and, most importantly, for the benefit of its Members and their savings.

2. Check your policy details and know your guarantees

Many of our With Profits products offer guarantees on your investments. On our Investment ISAs we guarantee that you will be able to withdraw 100% of your initial investment, plus any bonuses we have added, less any withdrawals you might have made, on the 10th anniversary or each 5th anniversary after that.

For our Investment Bond holders, we guarantee 101% of your initial investment, plus any bonuses we have added, less any withdrawals you have made, on the 10th anniversary or each subsequent 10th anniversary after that. Check your product information or get in touch with us and we will be able to help.

3. Review your drawdown options

Remember, with our Investment Bonds, you can withdraw up to 5% of your initial investment each year penalty-free. For Investment ISAs, you can withdraw up to 10% of your investment penalty-free. Check your product details to see how this could help your financial needs without dramatically altering your savings plans.

4. Seek professional advice

If you’re unsure what to do, we encourage you to seek advice from an Independent Financial Adviser who will have the expertise to help you navigate through situations such as this one. The peace of mind you can receive from this might be just what you’re looking for. Remember though that you may be charged for this service.

 

Putting our Members first, always

As a mutual, we are here solely for the benefit of our Members and have worked with our expert advisers to ensure the Society remains in good shape for the future and delivers a fair outcome for all. The decisions we have made are entirely designed for the benefit of the Society and its Members with a long-term outlook.

Above everything. Stay safe. If any of our Members have any questions or would like to talk to one of our team about how we might be able to help them, please don’t hesitate to get in touch. Our phone lines are a little busier than normal, but we are still open and we’re still here for your benefit. We’re also in the process of upgrading the Members’ area on our website to provide you with detailed information and up to date answers on the subjects that you have been speaking to us about. You can find your way to the Members’ area here.

Has the outbreak of Covid-19 affected your long-term savings plans? Let us know if you have any concerns about your savings products with us. We cannot provide advice, but we are happy to give you all the information you need to help you.

 

Sources:

*https://www.londonstockexchange.com/exchange/prices-and-markets/stocks/indices/summary/summary-indices-chart.html?index=UKX

 

 

Please Note: You must confirm you have read the key facts, before downloading this document.

Key Facts about our services and costs

1. The Financial Conduct Authority (FCA)

The FCA is the independent watchdog that regulates financial services. This document is designed by the FCA to be given to consumers buying certain financial products. You need to read this important document. It explains the service you are being offered and how you will pay for it.

2. Whose products do we offer?

We offer products from the whole market

We only offer products from a limited number of companies

We only offer our own products

3. Which service will we provide you with?

We will advise and make a recommendation for you after we have assessed your needs.

You will not receive advice or a recommendation from us. We may ask some questions to narrow down the selection of products that we will provide details on. You will then need to make your own choice about how to proceed.

We will provide basic advice on a limited range of stakeholder products and in order to do this we will ask some questions about your income, savings and other circumstances but we will not:

  • conduct a full assessment of your needs;
  • offer advice on whether a non-stakeholder product may be more suitable.

We can only offer products from Kingston Unity Friendly Society. These products will enable you to:

  • protect yourself and your loved ones in the event of death
  • save and invest with the added benefit of protecting yourself and your loved ones in the event of death
  • provide benefit cover in the event of sickness

4. What will you have to pay us for our services?

Normally, if you buy a financial product direct from us, there will be no payments such as commission or fees payable. If there are any commission or fees payable, we will tell you how we get paid and the amount before we carry out any business for you.

5. Who regulates us?

Kingston Unity Friendly Society, 9 Navigation Court, Calder Park, Wakefield, WF2 7BJ is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and .the Prudential Regulation Authority. Kingston Unity Friendly Society’s FCA Registered Number is 110056.

Kingston Unity Friendly Society permitted business is advising and arranging life assurance and pensions business.

You can check this on the FCA’s Register by visiting the FCA’s website www.fsa.gov.uk/register or by contacting the FCA on 0845 606 1234.

6. What to do if you have a complaint

If you wish to register a complaint, please contact us:
…in writing Write to Kingston Unity Friendly Society, Complaints Department, 9 Navigation Court, Calder Park, Wakefield, WF2 7BJ. …by phoneTelephone (01924) 240164

If you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service.

7. Are we covered by the Financial Services Compensation Scheme (FSCS)?

We are covered by the FSCS. You may be entitled to compensation from the scheme if we cannot meet our obligations. This depends on the type of business and the circumstances of the claim.

Most types of insurance business are covered for 90% of the claim with no upper limit.