A Guide to MetLife Guaranteed Investment Bond
The MetLife Guaranteed Investment Bond is a unit-linked insurance bond that offers a range of investments with a range of guarantees. As with all guaranteed investments, it is a great option for those who need the security of knowing that there is no risk to their capital.
To sum up the MetLife Guaranteed Investment Bond in simple terms: your capital is guaranteed, and the minimum you will be repaid is the amount you have invested.
It is important to note that the guarantee on the MetLife Guaranteed Investment Bond is not automatic – it is activated by opting for MetLife’s Secured Capital Option, when setting up your investment. Failure to specify the Secured Capital Option will mean that this is not a guaranteed investment.
Principle First will be happy to assist investors to avail of all guarantee options available on this and the full range of MetLife guaranteed investments.
The MetLife Guaranteed Investment Bond offers a guaranteed investment over 8 years, which means that money must be left invested for that time. Those making guaranteed investments in the MetLife Guaranteed Investment Bond should be aware that it is essential to lock their money away for 8 years.
The minimum investment in MetLife’s Guaranteed Investment Bond is £10,000. Additional top-ups to the Guaranteed Investment Bond can be made at any time.
Increase Your Guaranteed Investment
The MetLife Guaranteed Investment Bond has the attractive feature that growth, up to 10% per year, can be rolled back in, and becomes part of the guaranteed investment or Secure Capital Value. In the case of growth, the sum guaranteed increases by the amount of the growth return rolled back in, and the new sum is now guaranteed as the new Secure Capital Value.
If your fund at the end of any year is less than the original Secure Capital Value, your Secure Capital Value is unaffected, and remains at its previous level. In simpler terms, your capital is protected and can only grow or remain the same, but never fall.
Withdrawals from the MetLife Guaranteed Investment Bond
You may withdraw from the bond each year, subject to a maximum of 5% of capital invested. These withdrawals normally do not incur tax.
The Tax Maximiser Option in the MetLife Guaranteed Investment Bond
The Tax Maximiser Option allows you to effectively surrender your bond and re-invest under the same guarantee, thus ‘rolling back’ any investment growth into your guaranteed investment. This is possible only once during the term of the MetLife Guaranteed Investment Bond, and not within the first five years of the term. This allows you to take annual withdrawals based on a potentially higher sum.
Investment advice should be sought from Principle First before exercising the Tax Maximiser Option. Our tax advisers will be happy to check for you if availing of Tax Maximiser is right for you.
Investment portfolios available within the MetLife Guaranteed Investment Bond
The MetLife Guaranteed Investment Bond invests in a range of portfolios managed by MetLife. You can switch between different guaranteed investment portfolios and also the cash fund at any time, although if you make more than 12 switches in a year, additional charges may apply. When invested in individual guaranteed investment portfolios, you may switch out, but not switch back in to the same portfolio within six months.
These annual or regular withdrawals are possible subject to a minimum of £100, but a minimum of £5,000 must remain in the fund at all times.
What is the price of security in the MetLife Guaranteed Investment Bond?
The security of guaranteed investments does involve extra cost, compared to non-guaranteed investments. In the case of MetLife’s Guaranteed Investment Bond, this is provided on the basis of a guarantee charge, which is an insurance premium covering the cost of the guarantee.
The MetLife Guaranteed Investment Bond is a stable, secure and well-designed investment product, which will be at home in all quality guaranteed investment portfolios.
Would you like to learn more about the MetLife Guaranteed Investment Bond or other MetLife guaranteed investments? Contact us now by making an investment enquiry or ring 0800 678 5929
