Risk Level – Each fund has a risk level attached to it which is a guide how risky the fund is. A higher number means a higher risk fund and a lower number means a lower risk fund. A higher risk fund will give you more potential for investment growth. The scale is generally 1 to 7.
Buy Out Bond – A type of retirement product also known as a Personal Retirement Bond
Contributions – These are the payments you pay into the pensions fund. In the case of a Buy out Bond, the only contribution allowed is the transfer from your previous employment. No further contributions are allowed to a Buy out Bond.
A Buy Out Bond (BOB) which can also be known as a Personal Retirement Bond, is policy that is set up by trustees of a pension scheme to provide retirement benefits for a former member of the scheme. It basically means that if you leave a pension scheme, you can bring your pension benefits with you and take control over it by having the value of your fund invested in a BOB. A Buy out Bond will also allow you access to your retirement benefits from the age of 50.
If you're planning to leave the company you currently work for, and you are a member of the group pension plan, a BOB could be a great option for you. A BOB will also be suitable if you decide to leave a company pension scheme for any other reason, or if the scheme is winding down.
When you've decided to set up a Buy Out Bond, the next step is choosing how best to invest the money you have. It can be invested into a range of investment funds. You'll have access to a wide range of different assets, and varying degrees of risk, so you'll be sure to find a solution that works for you.
Buy Out Bonds are available from most Life companies, and a broker would be able to give advice on what options are available.
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