As the situation surrounding the novel coronavirus (COVID-19) progresses, we are monitoring the news and updates daily, in order to help us offer advice and assistance our members. As we adjust to the safety measures and social distancing, it’s a concerning and uncertain time for all of us. As a mutual, we’re here to support and assist you, and our aim remains the same: to protect your investments.
The spread of COVID-19 and its global impact has resulted in an unpredictable economic climate. During a time where many may be concerned about their finances, it’s understandable that, as one of our valued members, you may have questions regarding your investment with us.
Below, you’ll find some useful information that may answer any questions that you have about your investments with us. In the meantime, we would like to assure you that we will continue doing everything we can to support our members throughout these unprecedented times.
We manage your money with care
Our investment plans are invested in a fund that is actively managed by Royal London Asset Management. This fund holds a diverse range of assets, including UK and overseas equities, commodities, bonds and cash products. The fund aims to provide consistent returns for our members, while managing the effects of market volatility and mitigating risk through diversified multi-asset strategies.
We also operate an investment strategy known as ‘smoothing’ which provides further protection for your investment in relation to downside risk. With smoothing, we keep back some of the returns the With-Profits Fund earns in good investment years and use them to help pay bonuses in poor investment years. Losses made in poor investment years may also reduce returns in good investment years.
Our investment plans are underpinned by a longer-term approach to saving. This gives your money more chance to grow, but also to recover from any periods when market conditions aren’t as favourable. As a result, over time, the effects of any short-term market volatility may be lessened through smoothing and potential long-term growth.
The investment strategy we use to manage your money has enabled us to pay members a bonus for 18 consecutive years, including during and after the financial crisis of 2008.
Is my money protected?
Yes. The products we sell fall within the Financial Services Compensation Scheme and you are covered for 100% of the amount you invest with us should our Society suffer a complete financial failure.
Protecting all of our members
When you withdraw any money from your plan, we will calculate the value of the investments that you hold within the With Profits fund to ensure that you leave with your fair share. This may mean that:
- If you have been invested through periods of strong investment performance, you might get a final bonus, or;
- If you have been invested through periods of poor investment performance, and you leave the fund, you may get back less than the current value of your plan.
If you get back less than the current value of your plan, this is because a Market Value Reduction (MVR) has been applied. An MVR aims to protect plan holders who have money in our fund, ensuring that they are not disadvantaged during or after periods of market volatility.
Please be assured that any money that remains invested in your plan will not be subject to an MVR. For more information on what an MVR is and why it is applied, please see this article.
Any other questions?
If you have any more questions then please get in touch with our Member Services team at members@shepherdsfriendly.co.uk or on 0800 526 249.
Please note: In light of the situation surrounding COVID-19, we are currently experiencing a high volume of phone calls. If you contact us via telephone, you may need to wait longer than usual to speak to our Member Services Team. So that we can prioritise vulnerable members, we kindly request that you only contact us via phone if it’s urgent. For all other enquiries, please send an email to the above address and we’ll get back to you as soon as we can.
Last updated 03/02/2021
