Investment bonus

At associate-level, the discrepancies pay between banks become clearer. The exception to this is the associate 0 year, when analysts transition to associates.

No deposit forex bonuses

The new pay for analysts and associates in investment banks, investment bonus.

Analysts are frequently paid bonuses at a different time of year (summer) to associates (winter), which means that associate 0s are paid a ‘stub’ bonus to keep them going during the 18 hungry months since their last analyst bonus and their first real associate one. To make matters even worse, associate 0s who join after an MBA qualification also get a sign-on bonus. Dartmouth's figures for analyst salaries and bonuses in years one to three highlight the similarities between base pay (salaries) at this level. Bonus figures aren't always comparable at this level due to differing bonus payment schedules between banks.

The new pay for analysts and associates in investment banks

How much will you really make as an analyst or associate in the investment banking division (IBD) of a bank in london in 2019? And which banks pay more (or less) than others?

London recruitment firm dartmouth partners has released its winter salary and bonus survey for banks in 2019. As ever, it confirms that working in M&A or corporate finance can be a very lucrative (if sometimes gruelling) career. In the first year out of university new hires in london can expect to make up to £92k ($114k) in total at goldman sachs. Six years later, as senior associates, they can expect to make up to £247k (at credit suisse)

Logan naidu, dartmouth partner's CEO, says winter bonus pools were down by between 5% and 10%, with associates feeling more pain than analysts. However cuts were well signposted, says naidu and people therefore seemed happy.

Analyst salaries and bonuses

Dartmouth's figures for analyst salaries and bonuses in years one to three highlight the similarities between base pay (salaries) at this level. Bonus figures aren't always comparable at this level due to differing bonus payment schedules between banks.

During your first year in the investment banking division of a major bank in london, your salary will be £50k. Your bonus will be between £21k and £41k for the full year, but european banks with different payment schedules give you a six month bonus to tide you over.

In the second year of your investment banking career, you’ll get a pay rise. Your salary should rise to between £55k and £60k, and your total compensation (salary plus bonus) could rise to over £100k, although there are variations between banks.

By year three as an analyst in an investment bank (aged around 25), you should be earning total compensation of around £110k.

Associate salaries and bonuses

At associate-level, the discrepancies pay between banks become clearer. The exception to this is the associate 0 year, when analysts transition to associates. Analysts are frequently paid bonuses at a different time of year (summer) to associates (winter), which means that associate 0s are paid a ‘stub’ bonus to keep them going during the 18 hungry months since their last analyst bonus and their first real associate one. To make matters even worse, associate 0s who join after an MBA qualification also get a sign-on bonus.

By year five of your career in M&A at a leading bank, you’ll be a proper ‘first year associate’ at this level, you can expect to earn around £165k. – more if you have the very good luck to be at bank of america.

As a second year associate you can expect to breach the £200k threshold if you work for the right U.S. Bank, but to remain below this if you don’t.

And, finally, as a third year associate, you might be expected to hit £250k at a U.S. Bank, or at credit suisse which has raced to the top of the league table. This is 7 years into your front office investment banking career (working a major bank in M&A or corporate finance). At this stage, you'll probably be aged in your late 20s.

This will undoubtedly sound very appealing if you’re a graduate in another industry on £35k. However, there are two things to bear in mind. Firstly, you will work a lot harder in an investment bank (think 80 hour weeks+, late nights and weekends). Secondly, only some survive this far. – it’s not unusual for at least 50% (often more) of an analyst class to drop out by the time you’re into associate level. Getting into a bank is hard. Getting to these pay levels is harder still.

Investment bonds

Investment bonds are life insurance policies where you invest a lump sum in a variety of available funds. Some investment bonds run for a fixed term, others have no set investment term. When you cash investment bonds in, how much you get back depends on how well – or how badly – the investment has done.

When might investment bonds be for you?

If you don’t understand a financial product get independent financial advice before you buy.

You want to invest a lump sum – usually at least £5,000

You can tie up your money for at least five years

You are comfortable with the fact that the value of your investment can go down as well as up and you might get back less than you invested

How investment bonds work

You invest a lump sum – the minimum is usually between £5,000 and £10,000.

Most investment bonds are whole of life. There is no minimum term, usually, although surrender penalties might apply in the early years.

Usually you or your adviser has a choice of funds to invest the money into.

At surrender or on death (or if not a whole of life bond at the end of the term), a lump sum will be paid out. The amount depends on the bond’s terms and conditions and migh depend on investment performance.

Some investment bonds might guarantee your capital or your returns. These guarantees usually involve a counterparty. If so they carry the risk of counterparty failure.

How your money is invested

You have a choice of two types of funds – with-profits or unit-linked.

Both have the same tax rules where tax is paid on both growth and income accrued in the fund by the insurer.

Risk and return

Some investments offer a guarantee that you won’t get back less than you originally invested.

By choosing a bond that allows you to invest in a variety of investment funds and switch funds easily you might weather the ups and downs of the market better. Find out more about diversifying.

Because there’s an element of life assurance, your investment bond policy might pay out slightly more than the value of the fund if you die during its term.

Access to your money

You can usually withdraw some or all of your money whenever you need to, but a surrender penalty might apply if you do so in the first few years. There might also be a tax charge. If you think you might want access to your money early, consider alternatives: popular investments at a glance. Opens in new window

Investment bonds also allow you to make regular withdrawals each year up to a specified limit. Withdrawals of up to 5% each year of the amount that you invested can be taken without triggering any immediate tax liability. However, the tax is in effect only deferred as, when the bond is cashed in, withdrawals will be added to any profit made and taxed as income in that tax year.

Always look at policy conditions to work out what charges might apply to full or partial withdrawals.

Charges

There might be charges to pay when you take out the bond.

Choosing a bond that guarantees that you won’t lose money, could mean you might pay more in charges.

Switching between an insurer’s investment funds is usually free, but you might be charged if you switch frequently.

You might have to pay a charge if you cash in within the first few years.

Insurers often offer a range of charging structures. Make sure you are happy and understand how your money will be charged

Are investment bonds safe and secure?

Your money is secure except in the unlikely event of the insurance company going bust.

You cannot claim compensation simply because the value of your investment falls.

Tax on investment bonds

All gains and income earned within an investment bond are taxed at 20% and paid directly out of the investment bond.

Withdrawals of up to 5% a year are allowed for up to 20 years without incurring an additional tax charge.

If you don’t use your 5% allowance in a given year, the allowance is carried over to the following year i.E. If you make no withdrawals in year one, you could draw up to 10% the following year without incurring a tax liability.

So if you’re a higher rate or additional rate taxpayer, paying 40% or 45% tax on income in the current tax year, an investment bond can minimise your income tax bill.

However, your tax bill does not disappear entirely. Instead, the tax is deferred and any additional tax due will be payable at the time you cash in the bond, or when it matures.

All capital gains are treated as income at this point. Although tax at 20% has already been deducted, you might have an additional income tax bill if your gains push your income over the higher or additional rate tax threshold in the year they mature.

You might be able to avoid this by using a method known as ‘top slicing’.

Top slicing works by dividing your profit over the lifetime of your bond (including withdrawals) by the number of years the bond has been held.

If the resulting figure, when added to your other income for the tax year, is below the higher-rate tax threshold, there is no extra tax to pay.

However, if the top-sliced profits still push you over the higher rate tax threshold for the year, then additional tax must be paid on the entire gain.

Where to get investment bonds

Investment bonds are also known as insurance bonds, with-profit bonds, unit-linked bonds and single premium bonds.

You can buy investment bonds through a financial adviser or directly from an insurance company.

If you’re not sure whether an investment bond fits your needs, it’s a good idea to talk to an independent financial adviser (IFA).

With-profits funds

If you save regularly or invest a lump sum using a life insurance policy, you might choose to invest in a with-profits fund. These aim to give you a return linked to the stock market but with fewer ups and downs than investing directly in shares. However, they are complex and are not as popular a form of investing as they used to be.

What is a with-profits fund?

Did you know?

With-profits funds are for money you don’t need to get at for a long time – there are often penalties for taking your money out early.

With-profits policies are medium- to long-term investment funds offered by insurance companies.

You might be offered a with-profits fund when you set up:

An investment bond

An endowment policy

A whole-of-life policy

Pension policies and annuities

How they work

The money you invest is pooled together with money from other people and invested in the insurance company’s with-profits fund.

The fund is managed by a professional investment manager, who puts the fund’s money into different types of investment, such as shares, property, bonds and cash.

The costs of running the insurance company’s business are deducted from the fund and what is left over (the profit) is available to be paid to the with-profits investors.

You get your share of profits in the form of annual bonuses added to your policy.

The company usually tries to avoid big changes in the size of the bonuses from one year to the next. It does this by holding back some of the profits from good years to boost the profits in bad years – this process is called ‘smoothing’.

You might also get a ‘terminal bonus’ when your policy matures.

You can ask the insurance company to give you details about its bonus policy before you buy.

With most policies, the amount of profit you earn depends mainly on the performance of the investments in the with-profits fund.

Usually, once added, bonuses can’t be taken away. But if you surrender early, the insurance company may limit some or all of the bonuses paid by applying a market value reduction (MVR) – or market value adjustment (MVA) - to your policy. This is most likely in times of adverse investment conditions like a stock market crash.

Types of with-profits fund

Conventional with-profits funds

An initial sum assured (guaranteed minimum sum) is increased by the addition of annual bonuses and a terminal bonus.

The size of bonuses depends on fund performance, the costs of the insurance business, and the need to smooth bonuses between good and poor years.

The trend has been for bonus rates to fall as the result of difficult market conditions.

Although market value reductions can be applied this would not normally be the case. Instead surrender penalties would usually apply if the policy was terminated early with no reductions applied on maturity.

Unitised with-profits funds

A unitised fund is split into units – when you pay into it you buy a certain number of units at the current price.

Unit prices increase in line with bonuses declared, and do not fall. Or if additional units have been added, these are not taken away (but market value reductions can be applied).

There might be surrender penalties if you decide to take your cash early.

Fixed price – the price of the unit never changes so bonuses are paid as extra units to your policy.

Variable price – bonuses are given as an increase in the unit price, so each unit you hold is worth more.

Bonuses

There are two kinds of bonus:

Annual bonuses, also called regular or reversionary bonuses

Final bonus, also called the terminal bonus

Here’s how bonuses are paid out:

Once it’s been added, an annual bonus can’t be taken away – even if the fund performs poorly in future – as long as you continue to meet the terms of your policy.

A final bonus might be added at the end of your policy. Whether you get one and how big it is depends on how well the fund does.

In good years, the fund manager can choose to keep some of the profits to help cover losses in bad years. This is called smoothing. This means that if there are long stretches without a profit, you might get low annual and final bonuses – or even no bonuses at all.

The insurance company can make a market value reduction to your policy if you surrender early, particularly in times of adverse investment conditions like a stock market crash.

If you leave a policy early, this reduction might claw back a large part – or even all – of any bonuses that have previously been added.

Inherited estate – what is it?

A fund needs to keep enough money on hand to meet its expenses, run the business and to pay what it owes to policyholders.

But over time, some funds build up far more than they need – usually through profits that were held back to cover losses that never happened.

This extra value is called the inherited estate.

The insurance company can use the extra money in one of two ways – for a distribution or a re-attribution.

Distribution – handing out extra funds

Each year, insurance companies must look at their inherited estate to see if they have more than they need to keep the fund running.

If they have too much, they can choose – or in some cases be required – to pay out the extra to policyholders – this is called a distribution.

A distribution can be paid out over time or as a one-off payment.

The company can use the extra money to either:

Give you a cash payout

Increase the value of your policy

Distributions are not guaranteed – you won’t necessarily get a distribution even if you hold the policy to the end.

Reattribution – using extra funds to restructure

In rare cases, an insurance company might use the extra funds from the inherited estate to change the structure of the fund.

For example, if a different structure would make the fund cheaper to manage.

If the company does this, you’ll get compensation for the part of the inherited estate you’re giving up to the insurance company.

This is normally a one-off cash payment.

If your with-profits fund goes through reattribution, your insurer must write to you with information on:

Reattribution process – including dates and a summary of who is involved.

Reattribution proposals – what the insurance company wants you to give up and what benefits and compensation you’ll get in return.

Policyholder advocate’s views – the policyholder advocate negotiates on behalf of policyholders with the company – they will write to you about whether the firm’s proposals are in your best interest.

Find out more in our guides about with-profit products

Follow the links below for more information:

Information you should be given

Product providers must provide you with ‘key facts’ information that you can understand.

What the investment is and how it works

Key risks including the risk of capital loss and counterparty risks

Charges (the fees that will be deducted from your returns or capital)

When you’ll have the right to access to the financial ombudsman service and the financial services compensation scheme

Getting financial advice

If you don’t understand an investment product get independent financial advice before you buy.

Guide to investment bonds

An investment bond gives you the potential for medium to long-term growth on your money, over 5-10 years or more, along with fund management expertise. You also get access to a mixture of funds, which are looked after by professional investment managers. Of course like any investment, the value can go down as well as up so you might not get back what you put in.

Investment bonds are usually classed as a single premium ‘life insurance’ policy because a portion of your ‘life insurance’ policy can be paid out upon death, but they are really an investment product. So if your need is solely for life insurance, you might want to research other more tailored options.

That said, you usually buy an investment bond from a life insurance company, or directly through a financial adviser. They will invest your premium on your behalf for potential capital growth, which should build up until you withdraw money from your policy.

Some investment bonds may require a minimum investment term and apply charges for cashing in early. There may also be a minimum investment amount that may range typically between £5,000 and £10,000.

Types of investment bonds

Investment bonds mainly fall into two categories, onshore and offshore. The main difference is their tax treatment. In high-level terms, those onshore are subject to UK corporation tax, which is offset by your provider, while offshore bonds are issued from outside the UK and the returns roll up gross of tax in the funds, apart from withholding tax, as described below. Offshore bonds may also offer a wider choice of funds.

Other common types of bonds include fixed-rate bonds, corporate bonds and government bonds. Each have their own benefits and risks and the tax situation of each can vary.

Onshore investment bonds

UK investment bonds are non-income producing investments and so have a different tax treatment from other UK based investments. This can provide valuable tax planning opportunities for individuals.

The funds underlying the bond are subject to UK life fund taxation meaning that you are treated as having paid income tax at the basic rate on the amount of your gain. This notional tax is not repayable in any circumstances. You will have no liability to capital gains tax or basic rate income tax on bond gains.

Certain events, also known as chargeable events, that can occur during the lifetime of your onshore investment bond may trigger a potential income tax liability:

Death giving rise to benefits.

Transfers of legal ownership of part or all of the bond (though not gifts).

On the maturity of the bond (only applies to capital redemption bonds).

You cash in all your bond or individual policies within it.

As you're treated as having paid basic rate tax on the amount of the gain, the maximum rate you would be liable for is the difference between the basic rate and higher or additional rate tax. The gains may also affect your eligibility for certain tax credits and you could lose some or all of your entitlement to personal allowances.

If you're a higher or additional rate taxpayer now but know that you will become a basic rate taxpayer later (perhaps when you retire for example) then you might consider deferring any withdrawals from the bond (in excess of the accumulated 5% allowances) until that time. If you do this, you may not need to pay tax on any gains from your bond.

Life assurance bonds held by UK corporate bonds fall under different legislation.

Special rules apply to trustee held bonds.

Offshore investment bonds

Offshore is a common term that's used to describe a range of locations where companies could offer customers growth on their funds that's largely free from tax. This includes "true offshore" locations such as the channel islands and the isle of man, and other locations such as dublin. Tax treatment can vary from one type of investment to another, and from one market location to another.

Offshore investment bonds are similar to UK investment bonds, as chargeable events occur on the same events described above for onshore bonds but there is one main difference. With an onshore bond, tax is payable on gains made (and investment income received) from the underlying investments of the life fund(s) invested in, whereas with an offshore bond no income or capital gains tax is payable on the underlying investment. However, there may be an element of withholding tax that can't be recovered. Withholding tax is deducted from interest and dividends received by the fund(s).

The lack of tax on an offshore bond means that potentially it could grow faster than one that is onshore, although this isn't guaranteed. But, note that you will pay income tax on any gain at your highest marginal tax rate. This is because on an offshore bond you're not treated as having paid basic rate tax on any gain. The gains may also affect your eligibility for certain tax credits and you could lose some or all of your entitlement to personal allowances.

Top slicing relief for gains on onshore and offshore bonds

Top slicing relief is most commonly available where you're liable to tax at a lower rate were it not for the inclusion of the chargeable event gain in your income for the year. It may reduce the tax payable on a bond gain, but it does not reduce the gain.

You may get a reduction on the tax payable on any chargeable event gain. HMRC have a process for calculating this which can be very complex, so if you would like to understand how this works, please speak to your financial adviser.

Taking withdrawals from the bond

An investment bond could therefore be a potentially tax-efficient way of holding a range of investment funds in one place.

You can withdraw up to 5% each year of the amount you have paid into your bond without paying any immediate tax on it. This allowance is cumulative so any unused part of this 5% limit can be carried forward to future years (although the total cannot be greater than 100% of the amount paid in). You will often see this referred to as the "5% tax-deferred allowance".

However, if you decide to take more than the accumulated 5% tax-deferred allowance, you will create a gain equal to the amount taken over the allowance. Your insurance company will send you details of the chargeable event gain arising for you to notify HMRC of the gain, and, you may be subject to income tax.

Fund choice

When you invest in a bond you will be allocated a certain number of units in the funds of your choice or those set out by the conditions of the bond. You can choose to invest in a range of funds, a portfolio, or a mixture of both. You can also usually switch between funds within your bond. However, there may be a charge for this.

Each fund will invest in a range of assets, such as fixed interest, shares and property, and the price of your units will normally rise and fall in line with the value of these assets. If invested in a diverse range of assets then there is potential to weather the storm of any changes in the market that could affect the value of your investment.

To find out about the fund choices available on our investment bonds, see the investment products section.

Further information

If you need more information on bonds, please speak to a tax specialist or contact a financial adviser. Information is also available on the gov.Uk website and on our tax and allowances webpage.

We are not recommending one option over another or providing advice.

Because tax rules can change, the impact of taxation (and any tax relief) depends on your individual circumstances.

With-profits investment

Investing for the medium to long term

The basics

Investing in with-profits funds means investing in a combination of shares, bonds, property and money market investments. Growth can come in the form of regular and final bonuses from the profits the fund might make.

Our with-profits investments

With-profits policies are designed for the medium to long term, ideally at least 5 to 10 years. We pool your money with that of other customers in one of our with-profits funds and that money is invested in a mixture of shares, bonds, property and money market investments.

The value of your with-profits investment can grow through the addition of yearly bonuses and, for most policies, there is the possibility of a 'final' bonus when your policy comes to an end. Bonuses are not guaranteed and bonus rates can go down as well as up. However, once added they can't be taken away. There is a risk that the value of your investment could go down as well as up and you may get back less than you invested.

With profits investment returns are shared out as bonuses, of which there are two main types, regular (or annual) bonus and final (or terminal) bonus.

Regular bonuses can be added to your policy each year (or more often). Many with-profits policies guarantee a minimum payout on specified dates or events and the addition of regular bonuses increases this minimum level of payout.

A final bonus may be added when you decide to cash-in your policy or if you move out of with-profits by switching to another fund.

A market value reduction (MVR) can apply to some types of with-profits funds. An MVR is an adjustment factor that can be applied to those leaving a with-profits fund at times other than those specified in the contract. This ensures that those leaving the fund do not receive more than their fair share of the underlying investment, and therefore enables us to treat with-profits customers fairly.

How we manage the funds

To help you understand how we manage the with-profits fund in which you’re invested, we produce two types of guides.

These guides can be downloaded from our with-profits useful guides page.

There are technical guides called the principles and practices of financial management (PPFM) and there are simplified, more reader-friendly versions.

Independent expertise and oversight

We're committed to treating our customers fairly at all times. To support this, we have a with-profits committee which brings independent expertise and oversight, to ensure fairness is fully considered in our with-profits decision making.

Banks under pressure to curb bonuses after bumper year

Some divisions have made huge profits this year, but the timing of big bonuses could look highly insensitive

“isn’t this supposed to be the start of a lockdown?” asked one barista working in the heart of london’s financial district on nov 5, the first day of england’s second national lockdown. “people are clearly fed up now and want to go back,” added a security guard, who spent the early months of the pandemic patrolling empty streets.

Bankers and traders flocking back to london’s financial district this autumn were not doing so just because they were fed up with working from home. Instead, many wanted to make sure they were being seen ahead of bonus day. The hope was that being in the office each day as a critical worker would put them in good stead for payday, explains one of the city executives who decided to commute in.

Meetings about this year’s bonus pot are taking place now and the stakes are high. Investment banking revenues have soared this year after market volatility caused by the pandemic triggered a trading boom and clients raced to raise debt and equity to get through the crisis. Anyone working for a big investment bank knows how much money has been made and many feel they deserve a slice.

Sources say discussions are taking place to manage down expectations even though traders are on track for bonus rises of between 10pc and 20pc. The likes of goldman sachs, which has a smaller consumer banking arm than its rivals and so is less exposed to losses from unpaid loans, will come under particular pressure to reward staff.

“it’s sharp elbows this year,” says one city banker. “many people who went into banking after the financial crisis have been promised that the good times will come back. If they don’t get big bonuses this year [after record performance], then when?”

If the message on bonus day is that the halcyon days before the financial crisis really are never coming back, the fear is that some may decide to jump ship. This is particularly the case in europe, where banks have struggled to keep up with their wall street peers for years.

Deutsche bank, once known for its gigantic bonuses and lavish christmas parties, has come under so much pressure to cut costs since the 2008 crash that it has got rid of its free office fruit bowls and christmas pensioner party.

However, many executives are keenly aware that the sight of bankers taking home giant bonus cheques after the year just gone would be unpalatable, to say the least.

The pandemic has destroyed jobs and is forecast to blow a $28 trillion (£21 trillion) hole in the global economy by 2025, leaving the entire world significantly poorer.

Banks that have been handing out billions of pounds worth of emergency covid loans will soon become debt collectors. UK regulators this month warned bank boards against paying out vast cash bonuses, a sentiment likely to be echoed elsewhere. Most bank chiefs agreed at the start of the pandemic not to pocket a bonus this year.

“we have heard from our clients in the US that they are facing pressure not to be seen to pay excessive bonuses coming out of 2020 given the broader economic backdrop,” says michaela rosbrook of mayfair-based headhunter wessex partners.

Under pressure from all sides, no bank boss wants to stand out during the upcoming bonus season. Christian sewing, chief executive of deutsche bank, admitted in an interview earlier this month that while performance would be rewarded, “we need to obviously look at our competition” before deciding final numbers at the end of the year. Barclays is also said to be keeping an eye on its peers before making any decisions.

The picture is slightly different for banks that do not have large and profitable investment banking arms. High-street lenders have been busy setting aside cash for loans that households and businesses might not be able to repay because of financial difficulty and at some point will have to start collecting those debts.

Lloyds, where the average salary is £36,600 a year, has already scrapped bonuses due to the impact of the pandemic on its profits. Bonuses at its closest rival, taxpayer-backed natwest, remain undecided but are expected to fall. Although branch staff have been on the frontline of the pandemic, they have no prospect of a bonus bonanza.

After a difficult year lenders are trying to reward staff in other ways this christmas. Lloyds is giving most employees above-inflation pay rises; virgin money has scrapped pay rises but is giving everyone £500; UBS has given lower-paid staff an extra week’s pay and increased basic salaries; and citigroup is offering its US workers a 12-week sabbatical and extended childcare benefits.

These alternative rewards could be the future of bank pay if public anger is to be allayed. Meanwhile the bankers and traders who are in line for a 2020 windfall are unlikely to go around shouting about it.

Potential to grow

If you have a lump sum that you think could work harder, our investment bond could be for you. It aims to make the most of your money, offering the potential for long-term growth over five years or more. And all free from basic rate income tax or capital gains tax. The future could look pretty rosy.

£5,000-
£150,000

Single or joint

Saving for your future, be it a rainy day, a big anniversary celebration or your retirement, needn’t be complicated. Our bond can be taken out in joint names, which is ideal for couples wishing to invest. And, with our expert fund managers looking after your investment and the ability to withdraw up to 5% each year tax-free, what is there not to like?

Request a pack to find out more about the investment bond request a pack

A little thank you for a big decision

There’s some good news. Invest a lump sum of at least £5,000+ in an investment bond online and we’ll send you up to a £160 M&S gift card once your money has remained invested for 3 months.

£40 M&S gift card for a lump sum investment of £5,000 – £9,999

£80 M&S gift card for a lump sum investment of £10,000 – £14,999

£120 M&S gift card for a lump sum investment of £15,000 – £19,999

£160 M&S gift card for a lump sum investment of £20,000+

Why choose our investment bond?

A great way to invest a lump sum of £5,000 – £150,000 with the potential for growth over five years or more.

Available to all UK residents aged 18 to 80.

Your money is invested in our with profits fund, which has performed consistently well vs. Comparable funds. It has the potential to grow thanks to annual and final bonuses. (source: barnett waddingham survey dec 2019)

Access to foresters extras – membership benefits – including discretionary grants to help you to cover the cost of things like higher education and healthcare costs.

You can apply in joint names – perfect for couples.

You can make withdrawals from your bond, ideal if you need to access your money (subject to conditions).

Our plans are covered by the financial services compensation scheme for extra protection for you.

You may get back less than you have paid in. Tax rules might change and depend on individual circumstances. Bonuses are not guaranteed and depend on the performance of our order insurance fund and how we decide to distribute any profits.

Make sure you’re fully informed about the investment bond by reading the key information document and important information documents.

Deborah, hampshire

“the educational award grant has been a great help in covering some of the costs associated with completing my HND in art and design…

I’m very grateful to foresters friendly society for providing this financial assistance and would encourage anyone to join, not just because of the support offered to members, but also the opportunity to join in with some fantastic social events.”

See how much you could save

You could get back more or less than this. \n

Inflation will reduce what you can buy in the future with the amounts shown. \n

The yearly growth rates reflect 3 possible future investment returns which are subject to the maximum rates specified by the financial conduct authority. Future investment returns may be higher or lower than those shown. \n

A real-life example

A £10,000 investment bond taken out on 1st december 2009 and surrendered on 1st december 2019 received a pay out of £17,695.68, on the basis of no earlier withdrawals being taken. This is total growth, after charges, of 77% or 5.9% per annum.

Past performance should not be seen as a reliable indicator of future results and the addition of annual and final bonuses is not guaranteed.

The final bonus rate is based on the year the money was invested into the plan and can change at any time.

The above graph is provided for information purposes. The potential for future bonuses depends on the performance of the order insurance fund and how we distribute any profit.

Ready to invest a lump sum? Apply today!

Added value for you – foresters extras

Taking out an investment bond is only the start. By doing so, you’re part of the foresters friendly family and can enjoy some wonderful, unique benefits such as discretionary grants to help with dental and optical costs.

Common questions

The bond can either be opened in your name (single life) or both your name and another’s name (joint lives) which can be ideal for couples.

If the plan is taken on a joint names basis, both planholders are automatically treated as holding equal shares in the investment bond. If one planholder passes away, the other automatically becomes the sole planholder of the investment bond.

If an investment bond is set up in joint names this will be on a second death basis. That means that the death claim is not paid until the death of the second of the two lives and the bond comes to an end at this stage.

We’ll send the annual statement and other correspondence to the first named planholder. If you would like to make any changes to your investment bond, the signature of the planholder or, in the case of joint life policies both the planholders, will be required. Just let us know and we’ll tell you what you need to do.

You can invest a single lump sum of between £5,000 and £150,000 into the investment bond. You cannot add to your lump sum investment bond once it’s in place, but if you want to invest more money, then you simply need to open another bond.

Yes, you can make one-off withdrawals of at least £250 at any time, as long as the remaining balance of your investment bond does not fall below £500. You can also make regular monthly, quarterly, half yearly or annual withdrawals, of at least £50, as long as the value of your bond remains over £5,000.

You need to remember that making withdrawals could reduce your investment bond to less than its initial value and could also have tax implications (please see the common question below for further details) .

For further information on the terms of withdrawals please take a few minutes to read the important information document.

You can withdraw up to 5% each year of the amount you have paid into your bond without paying any immediate tax on it. This allowance is cumulative so any unused part of the 5% limit can be carried forward to future years (although the total cannot be greater than 100% of the amount paid in).

However, if you decide to withdraw more than 5% per year and/or you cash in your entire bond, we will calculate any gains on your money, and you may be subject to income tax. For higher or additional rate taxpayers this means that there may be an amount of tax to pay. Please note that tax rules may change and depend on individual circumstances.

For further information please read the important information document.

Yes, that’s absolutely fine. You can place your investment bond in trust. You may want to take advice from a solicitor before doing this.

Your money is invested in our consistently well performing order insurance fund with the aim of providing investment growth. Dependent on the performance of our fund, we aim to add annual bonuses and a final bonus to your bond which will increase your plan’s value. The addition of bonuses is not guaranteed.

We never forget it’s your money, so we take extra good care of it. Within our fund, your money is spread across a number of different types of investments including property, equities, cash and UK government bonds, to help minimise risk and increase the potential returns. You won’t have to make any investment choices, our expert fund managers manage the fund on your behalf.

Please see the principles and practices of financial management (PPFM) for the latest information on our investment strategy.

As a friendly society, it’s particularly important to us that our investments are managed in an ethical and responsible way. Foresters is a signatory of the principles for investment (PRI) which demonstrates our commitment to responsible investment, to reducing our impact on the environment and mitigating climate change risk in our investment portfolios.

When you open a plan, you can be confident that investing with us means your money will be invested in a trustworthy and environmentally conscious way. The PRI is the world’s leading supporter of responsible investment and promotes a better understanding of the investment implications of environmental, social and governance (ESG) factors.

Find out more about the 6 PRI principles we have signed up to here.

The investment bond doesn’t pay interest. Instead, by investing the money you pay into the plan into our order insurance fund, which is a with profits fund, we provide your plan with the potential for growth by way of bonuses. Any profits generated by the fund are used to add an annual bonus to your investment bond and possibly a final bonus when you withdraw your money.

We have paid annual bonuses on our investment bond for the past 16 years.

In 2019 the annual bonus rate was 1.5%.

The annual bonus is applied to the amount invested (minus any withdrawals you may have made from your bond) plus any previous bonuses that have been added.

The addition of any bonus is not guaranteed and you may not get back the full amount originally invested, dependent on the investment conditions at withdrawal.

To find out more about the addition of bonuses and how we manage our fund please read our principles and practices of financial management (PPFM).

We may vary the design of a product to best meet the needs of our planholders which may affect the timing and size of future bonuses. Therefore the above table is provided for information purposes only and should not be considered an indication of likely future performance.

There is an annual management charge which is initially set at 2% of the value of your investment bond. And because we don’t believe in hidden costs, we deduct charges upfront before we declare bonuses. This means there are no additional charges for you to pay. This charge could increase, but we promise it will never be more than 3% of the value of your bond in any one year. The charges are designed to cover our costs for administering the bond on your behalf.

Being a with profits investment, your investment bond will benefit from growth the longer it is kept invested. Ideally for a minimum of 5 years but the longer the better. However, you can cash-in your bond whenever you want. The cash-in value will depend on the amount invested, the amounts that have been withdrawn and any annual bonuses that have been added. Depending on the investment returns achieved and our costs, in good investment conditions we may also add a final bonus. However, in not-so-good investment conditions, we may apply a market value reduction (MVR) which will reduce the plan’s value and may mean you get back less than was paid in.

For more details please take a few minutes to read the important information document.

If you’re unsure as to the suitability of this product you should seek advice from a financial adviser.

Investment offers and brokerage bonuses

Check out these investment promotions and brokerage bonuses that offer cash incentives, free stock rewards, investing credits, free portfolio management, cryptocurrency bonuses, commission-free trades, and more sign-up offers when you open new brokerage, retirement, investing, and trading accounts.

Stock trading bonuses

Earn free stock awards with these trading services:

Dough - $2-$200 free stock.

Firstrade - $3-$200 free stock.

Moomoo - up to $1,000 free stock.

Passfolio - $5-$100 free stock.

Public - $10 free stock.

Robinhood - $10 free stock.

Sofi invest - $50 bonus.

Tradeup - $2.50-$1,000 free stock.

Webull - $21-$3,700 free stock.

Managed investment bonuses

Earn bonus cash and free investing portfolio management:

Acorns - $5 bonus.

Betterment - 12 months free.

Round - $20/$100 bonus.

Wealthsimple - $10,000 managed free.

Investing portfolio rewards

Earn bonus cash in your personalized portfolios:

M1 finance - $30 bonus.

Nvstr - $10+ bonus.

Stash invest - $20 bonus.

Brokerage account bonuses

Earn bonus cash with new brokerage accounts:

Ally invest - $50-$3,500 bonus.

Charles schwab - $100 bonus.

Etrade - $100-$3,000 bonus.

Fidelity - 500 free trades.

Merrill edge - $600 bonus.

Cryptocurrency investing offers

Earn bonus rewards for investing in cryptocurrencies:

Constant - $8+ bonus.

Etoro - $50 bonus.

Sofi crypto - $25 bonus.

Voyager - $25 bitcoin.

Real estate investment deals

Get cash rewards with real estate investing services:

Groundfloor - $10 bonus.

Landa - $10 bonus.

Lendinghome - $500 bonus.

Roofstock - $500 credit.

Alternative investing promotions

Earn cash bonuses for trying alternative investments:

Iban wallet - $25 bonus.

Linus - $20 bonus.

Nextseed - $20 bonus.

Worthy bonds - $10 free bond.

Recent investment offers

Review more investing bonuses and brokerage deals below:

Voyager no-fee cryptocurrency brokerage $25 free bitcoin credit

Try voyager’s commission-free cryptocurrency brokerage to trade crypto assets across multiple exchanges with USD, plus get $25 in free BTC when you trade a minimum of $100, and earn $25 more BTC for each qualified referral. [read more] voyager no-fee cryptocurrency brokerage $25 free bitcoin credit

Linus – 4.5% cash deposit account: earn $20 bonus with $100 deposit + $20 referrals

Earn up to a 4.5% APY on your funds when you open a linus alternative cash deposit account (all accounts automatically earn 4% APY), plus get a $20 bonus when you deposit $100, and get unlimited $20 bonuses for sharing linus with your friends. [read more] linus – 4.5% cash deposit account: earn $20 bonus with $100 deposit + $20 referrals

Webull brokerage account app: 4 free stocks referral bonuses

Webull is a free stock trading app that allows you to open a commission-free brokerage account with no minimum balance requirements and no fees to open or maintain an account.

To get 4 free stocks, sign up via this webull free stock link and deposit at least $100 within 30 days.

Updated 1/19/2021 – webull limited-time promotions: from 1/16/2021 – 2/1/2021, new users can get 4 free stocks. In addition, for each of your referrals who makes an initial deposit of $100 or more between 1/16/2021 – 2/1/2021, you will be able to claim 2 free stocks. [read more] webull brokerage account app: 4 free stocks referral bonuses

M1 finance free investing platform $30 bonus credit and $30 referrals – get $30 to fund account with $100 for 30 days

Make investing your money simple using M1 finance with no commissions ever and no fees, plus get a $30 bonus credit when you invest a minimum of $100 into your new brokerage account.

Limited-time promotions: participate in “M1 referrals give $30, get $30” to earn a $30 bonus for both parties through february 28, 2021. On top of that, all members earn up to $3,500 when you transfer your investments to M1 from another brokerage, starting at a $40 bonus for a $10,000+ transfer. [read more] M1 finance free investing platform $30 bonus credit and $30 referrals – get $30 to fund account with $100 for 30 days

Firstrade – get free stocks with refer-A-friend bonus

Firstrade now offers a free stock valued $3 to $200 upon account approval, plus you can earn up to $500 in free stocks for referring friends and family.

Through january 31, 2021, get 3 free stocks from firstrade and enter to win an iphone 12. Get 1 free stock to open an account between 1/16/2021-1/31/2021, get 2 additional free stocks to deposit or transfer $100 or more within 30 days of account approval, and get a chance to win an iphone 12 when you deposit early by 1/31/2021. [read more] firstrade – get free stocks with refer-A-friend bonus

Etoro – trade cryptocurrencies: get $50 referral bonus with $100 trade + limited-time $500 promotion

Etoro cryptocurrency trading is offering a $50 cash bonus when you link a bank, make a deposit, and trade $100 in crypto.

Plus, for a limited time, etoro is offering new members a special $500 bonus offer when you trade $5,000 in crypto. [read more] etoro – trade cryptocurrencies: get $50 referral bonus with $100 trade + limited-time $500 promotion

If you want to earn some free stocks for your investing portfolio, check out these brokerage account offers that give new users free shares of stock. [read more] free stock sign-up bonuses: get free stocks with new brokerage accounts

Acorns – spare change investment app: $5 referral bonuses + $150 september promo

Acorns is an investment service that invests your spare change automatically from everyday purchases into a diversified portfolio, plus you can get a $5 free credit just for creating a new account, and you’ll earn an additional $5 bonus for each new acorns investor that you refer.

Refer 3 friends for $150 in september 2020: acorns will give you $150 in bonus cash when you invite 3 friends to acorns who sign up and make their first investment between 9/1/2020 and 9/30/2020. [read more] acorns – spare change investment app: $5 referral bonuses + $150 september promo

Constant – secured P2P investment platform: $8 bonus + $15 referrals

Check out constant to automatically earn a 4% APY on all of your deposits, plus get a $6.67 bonus just for joining and verifying your ID, which can be withdrawn after 30 days with no obligation to invest further. [read more] constant – secured P2P investment platform: $8 bonus + $15 referrals

Salaries and bonuses for managing directors in banks in london, new york and hong kong

We've told you how much you're going to earn as an analyst or an associate in an investment bank. We've told you how much you're going to earn as a vice president (VP). But what happens if you make director and then managing director (MD) in an investment bank? How much will you earn then?

A new salary and bonus survey from banking executive search firm pinpoint partners purposes to provide the answers. If you make director or MD in a bank, you're going to earn a lot. - but just how much will depend where in the world you're based.

Pinpoint's survey refers only to directors and mds in investment banking divisions (IBD) - ie. Working in M&A or equity capital markets (ECM), or debt capital markets (DCM). They don't apply to people doing sales and trading jobs in the markets divisions of investment banks.

How much does a director earn in an investment bank?

A director in an investment bank earns between $383k and $727k in combined salary and bonus, depending upon seniority and location.

How much does a managing director earn in an investment bank?

Pinpoint says an MD in an investment bank earns between $640k and $2.6m in combined salary and bonus. As the charts below show, pay is generally highest in new york city and lowest in hong kong. London falls between the two.

Needless to say, there aren't just a few directors or managing directors in each investment bank. - director and MD are just rungs on the banking hierarchy, with MD at the top. Most banks have thousands of each. Directors typically hang around three years (before getting promoted to MD or fired), although some hang on for longer.

The chart immediately below shows average total pay (salaries plus bonuses) for directors and mds in london, new york and hong kong. The charts below that show salaries and bonuses individually in each city.

There are a few anomalies - second year MD compensation in new york is weirdly low, for example. Second year MD compensation in london is an extrapolation based on first and third year MD compensation as pinpoint had insufficient data. Mostly though, it looks like new york salaries and bonuses for senior investment bankers are higher than elsewhere.