What exactly is a ‘Friendly Society’?
Thursday, November 21, 2013
The world of finance can often seem a confusing place full of different providers and unusual terms to learn about, so we have chosen to dedicate one of our helpful guides to the topic of Friendly Societies.
You may not have heard of or know what a Friendly Society is, but they are one of the oldest types of financial services operations around, we are actually approaching our 180th anniversary next year, and many people looking for an alternative provider are turning to mutual companies like Foresters Friendly.
Financial products and customer support
Historically Friendly Societies were formed as a way for working people to receive help in times of ill health or old age and they provided essential financial and social support to their members when needed.
Over time Friendly Societies have developed into financial organisations which offer products such as savings, investments and life cover, whilst also incorporating the traditional benefits not seen in many other financial companies.
Customers are at the heart of everything
With no shareholders to pay dividends to, any revenue the Societies make can be used for the benefit of their customers or members by investing in customer service and distributing any remaining profit to members in the form of financial bonuses or in the provision of a member benefits/benevolence package.
Unique tax free status
Because of their legal status, Friendly Societies are able to offer unique tax-exempt savings products that are not available from other providers such as high street banks. Under current legislation, this means that each person (including children) can save up to a maximum of £25 a month in a Friendly Society tax free savings plan, which is in addition to their annual ISA allowance. However, you should be aware that tax rules may change and depend on individual circumstances.
Free Guide to Friendly Societies
You can find out more about Friendly Societies in our 'Guide to Friendly Societies' which explains what a Friendly Society is, how they work in today's society, the products they offer and the benefits you could receive by becoming a member of one.
Download our free PDF guide for more information on Friendly Societies
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