Stocks & Shares ISA

In any one tax year you can open a Cash ISA and a Stocks & Shares ISA, in addition to a Lifetime ISA if you are eligible. But you have to make sure that the combined annual contributions do not exceed the annual ISA allowance. You can also hold ISAs from previous years, it is only the contributions you make to your ISA in the current tax year which counts towards this year’s annual ISA allowance.

Please note that tax rules may change and depend on individual circumstances.

Good question. Well, Cash ISAs are savings accounts that pay interest that is free of income tax. Unlike Stocks & Shares ISAs the value of your capital cannot rise and fall. They are available to anyone aged 16 and over, and come in two types:

• Instant Access. This is where you have direct access to your money and can make withdrawals whenever you want to for any reason.
• Fixed Rate. This is when you aim to lock away your money for a set period of time to potentially benefit from a better rate of interest.

A Stocks & Shares ISA, like the one offered by us, is intended to be a longer-term investment and is available to anyone aged 18 years old and over. There is the potential for a greater return on your savings over the longer term than with a Cash ISA due to the differing investment approach although, depending on the performance of the stock market and any other asset types your money may be invested in, the value of your investments can fall as well as rise and you may not get back the full amount originally invested in a Stocks & Shares ISA.

Yes, you can transfer an existing ISA into our Stocks & Shares ISA and then continue to save for your future with Foresters Friendly Society.

Transferring an existing ISA to us is simple. If you are opening a new ISA with us, all you need to do is select the Transfer option in the online application. You’ll need to download and complete the Transfer form provided, then send this to us by post and we will contact your existing ISA provider to start the transfer process.  You won’t need to do any more than that and we will contact you when the ISA transfer is finished.

If you are transferring into an ISA you already hold with us, you can start this process online by clicking here, providing your existing Foresters ISA policy number, and selecting Transfer in the payments section. You’ll find a Transfer form there which you’ll need to complete and return to us by post. We’ll then do the rest and let you know when the transferred funds have been added to your Foresters ISA.

If you would like to discuss transferring to Foresters Friendly Society in more detail, either call our friendly UK-based team on 0800 988 2418 or email us at [email protected] and we will be happy to answer any questions you may have.

The money you pay into the Stocks & Shares ISA is invested in Foresters Friendly Society’s 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 ISA which will increase your plan’s value. The addition of bonuses is not guaranteed.

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.

Many funds that invest in a variety of asset classes would have a mixture of equities and bonds.  These asset classes traditionally have a negative correlation, meaning that if equities go up in value, bonds generally go down in value.  The opposite happens when equities go down in value.  Over the past few years this correlation has moved to a positive correlation, resulting in equity and bond valuations moving in the same direction.  This can increase the risk of poor returns and increased volatility in fund values.

We use private assets to help diversify our fund and reduce its overall risk, as private assets are not so closely correlated with equity and bond (public) investments and so can help to balance investment volatility.  Private assets also offer the potential for higher returns as they are often long term investments.  The downside is that private assets offer lower flexibility than public assets. We monitor the overall exposure between private and public assets to ensure the mix meets our expected cashflows.

Our Stocks & Shares ISA 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 ISA and possibly a final bonus when you withdraw your money.

We have paid annual bonuses on our Stocks & Shares ISA for the past 19 years.

• In 2022 the annual bonus rate was 1.25%.

The annual bonus is applied to the amounts you have invested, less the amounts you have withdrawn, and any annual bonuses that have been previously 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 policyholders which may affect the timing and size of future bonuses. Therefore the above rate is provided for information purposes only and should not be considered an indication of likely future performance.

There is an Annual Management Charge of 2% of the value of your ISA. 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 exceed 3% of the value of your ISA in any one year. The charges are designed to cover our costs for administering the ISA on your behalf. For more information about charges, please take a few minutes to read the Stocks & Shares ISA Key Information Document and Important Information.

If you need access to your money, regular and one-off withdrawals can be made as long as the remaining balance of your ISA does not fall below £500. Regular withdrawals at fixed points in time i.e. monthly or quarterly can be made after two years, and one off withdrawals can be made at any time.

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

Being a with profits investment, your ISA will benefit from the potential for 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 investment 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 change your mind and wish to close your ISA within the 30 day cancellation period, you can just complete the cancellation form and return it to us.

You can cash-in your ISA whenever you choose after the 30 day cancellation period has passed. But due to the nature of the investment, you may find you get back less than you have paid in.

For more information please see the Important Information document.

If you’re unsure as to the suitability of this product you should seek advice from a Financial Adviser. Of course, you may have to pay for this advice.