Investment Bonds Explained
Compare investment bonds
Explained in simple terms investment bonds are essentially single premium fund investments which include a small element of life insurance.
Investment bonds can either be used to provide medium to long term growth for your funds or alternatively you may be able to use the returns to provide a regular income.
Unit linked investment bonds explained
This type of investment bond is divided into units. You purchase units in chosen funds, depending on your attitude to factors such as risk. The value of your your fund will fluctuate in line with the rising or falling success of your core investments.
With profits investment bonds explained
With profit investment bonds are designed to smooth over the fluctuating returns that you may see with unit linked investment bonds. If your fund performs particularly well in one year some of your returns will be kept back to be paid in years when your fund doesn’t perform as well. This does not mean that your bonuses do not vary from year to year, but that the fluctuations are somewhat smoother.
With profit investment bonds are designed to smooth over the fluctuating returns that you may see with unit linked investment bonds. If your fund performs particularly well in one year some of your returns will be kept back to be paid in years when your fund doesn’t perform as well. This does not mean that your bonuses do not vary from year to year, but that the fluctuations may be somewhat smoother.
Investment funds
Whether you invest in unit linked or with profits investment your money will be pooled in a group fund of your choice and invested in a combination of investments or in individual funds investing in particular areas such as stocks, shares, property or government bonds.
Investment bonds are usually offered by insurance providers. The element of life insurance included with investment bonds means that should you pass away before you cash in your your beneficiaries will receive a small life assurance payout. This can make investment bonds suitable in later life.
Whether investment bonds are right for you will depend on your own individual circumstances. You may want to discuss your investment options with an independent investment advisor. Alternatively, use the table below to compare some of the most popular investment bond products.
Selected investment Bonds
| Provider | Product | More Info |
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| Click More Info on the product you like the most! | ||
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Zurich Sterling Bond 5 Year bond with 80% capital protection on day one which increase as the value of the fund grows. |
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Liverpool and Victoria Invest in a stockmarket related product with the ability to switch between three 'ready made' fund options |
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Metlife Income for Life Investment Bond The Met Life Secure Income Option enables you to take a guaranteed income of up to 5% for life regardless of market conditions. |
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