Prudential Investment Plan

Our Prudential Investment Plan is an investment bond that lets your clients invest their money in a range of different funds. The plan aims to grow the value of their investment over the medium to long-term (5-10 years).

Your clients can start with a single payment and can then make additional lump sum payments if they want to.

Withdrawals can be made, and they can cash in their Plan at any time.

Contributions

• Minimum initial investment: £10,000 (after any set up Adviser Charges)
• Maximum investment: £500,000 (including initial investment and additional top-ups)  

For requests to invest more than £500,000, please contact your Account Manager.

Withdrawals

Your clients can:

• Cash in their plan at any time

• Take regular or partial withdrawals at any time

• Set the amount and frequency of regular withdrawals

The maximum level of regular withdrawals during any 12 month period is the greater of:

• 7.5% a year of the value of the fund, or

• 7.5% of the total amount paid into the plan

Your client can take up to 5% of their initial investment and any additional investments as a tax-deferred withdrawal each year. Anything above this may be liable to immediate Income Tax. Your client might need to pay tax depending on their circumstances and the options they choose. Tax rules can also change in the future.

All withdrawals are subject to a minimum withdrawal payment of £50.

Regular and partial withdrawals from a With-Profits Fund* may incur a Market Value Reduction (MVR).

Download the Key Features Document (PDF) for more information.

* Access to the Prudential With-Profits Optimum Return and Optimum Bonus Funds is no longer available to new customers investing in Prudential Investment Plan (PIP) on or after 11 September 2017. This information is only applicable to policyholders pre 11 September 2017.

There is a wide range of investments for your clients to choose from with access to Prudential’s Multi-Asset Fund range, including the established PruFund range of funds.

See the Prudential Investment Plan fund guide for more details on the funds available.

The Prudential With-Profits Funds are designed to spread the investment risk by investing in a range of different assets, and are managed by M&G Treasury & Investment Office (TI&O).

The Prudential With-Profits Optimum Return and With-Profits Optimum Bonus Funds are no longer available to new customers investing in Prudential Investment Plan (PIP) on or after 11 September 2017.

If you have an existing client who became a policyholder before 11 September 2017, they will still be able to top up or switch into the Prudential With-Profits Optimum Return Fund and the Prudential With-Profits Optimum Bonus Fund.

Find out more about the With-Profits Fund.

For investments in the With-Profits Optimum Return and Optimum Bonus Funds, we offer a Market Values Reduction-free guarantee on death.

The total deduction for the guarantee charge over the lifetime of your plan is not currently more than 2% of any payment made to the fund. We might change our charges in the future. Charges may vary if, for example, the long-term mix or type of assets held within the With-Profits Fund is changed.

For investments in the With-Profits Optimum Return and Optimum Bonus Funds*, a Market Value Reduction (MVR) may apply if the client switches funds, withdraws money or if the plan is cashed in. We offer an MVR-free guarantee on death. 

Market Value Reductions are our way of protecting the interests of all our With-Profits customers, balancing the interests of continuing investors with those who wish to cash-in their plan.

Learn more about when an MVR may or may not apply in our Market Value Reduction Explained (PDF) document.

* Important information: Access to the Prudential With-Profits Optimum Return and Optimum Bonus Funds is no longer available to new customers investing in Prudential Investment Plan (PIP) on or after 11 September 2017. If you have an existing client who became a policyholder before 11 September 2017, they will still be able to top up or switch into the Prudential With-Profits Optimum Return Fund and the Prudential With-Profits Optimum Bonus Fund.

We announce the Expected Growth Rates that apply to the PruFund Range of Funds every quarter.

Find out more about our Expected Growth Rates, Historic Expected Growth Rates or Unit Price Adjustments for the PruFund range of funds.

The PruFund Protected Funds are currently unavailable to new investments.

We offer guarantees for PruFund Protected Cautious Fund and PruFund Protected Growth Fund. At the end of the selected guarantee term the fund will be worth at least the amount your client invested (subject to charges, enhancements or withdrawals).

The main charges and costs will be:

• Annual Management Charge
• Charges for guarantees (where applicable)
• Adviser charge (set up charge and ongoing charges)

We might change our charges in the future.

We take an Annual Management Charge for looking after your investment.

• Unit-Linked Funds: we take an Annual Management Charge (AMC) from each of the funds your client invests in. The charge is taken daily as a deduction from the fund.

• PruFund Funds: we take the AMC for these funds by deducting a percentage of those units from the plan every month.

• With-Profits Funds: the charge depends on the performance of the fund, in particular, the investment returns and our expenses. Download the Key Features Document (PDF) for more detail.

Further Costs 

There are other costs which aren't covered by the Annual Management Charge. These can include, for example, maintenance costs for property investments and costs associated with investing in infrastructure, such as utilities, transport and renewable energy. These can vary over time.

Further information on the charges and costs for each fund can be found in the appropriate Key Information Document and Investment Options Documents linked to at the top of this page. The Prudential Investment Plan fund guide also includes information on fund charges and costs.

Fund Size Discounts

We offer Fund Size Discounts on the Annual Management Charge which apply to the whole investment, not just the portion above the threshold levels shown below.

Your clients can switch funds at any time, but can only invest in 10 funds at any time. We currently don’t charge for switching, but if this changes in the future, we’ll inform your clients. 

The minimum amount your clients can switch is £500. If they’re not switching the full value of their investment from a particular fund, they must leave at least £500 in that fund.    

Further details on fund switching can be found in the Fast Facts document (PDF).

The PruFund Protected Funds are currently unavailable to new investments.

We offer guarantee terms for both PruFund Protected Cautious Fund and PruFund Protected Growth Fund, where the guarantee will only apply at the end of the selected guarantee term (the guarantee date) providing your client doesn’t switch out of the funds.

Once the guarantee term has been selected, the charge will remain fixed throughout the guarantee term. The guarantee will only apply at the end of the selected guarantee term.

For specific fund charges and costs, download the Prudential Investment Plan fund guide.

The level and shape of Adviser Charging is agreed between you and your client.

There are three types of Adviser Charges:

• Set-up Adviser Charge: deducted from the initial investment before it is invested in the plan
• Ongoing Adviser Charge: taken at plan level, will apply across all in-force segments

• Ad hoc Adviser Charge: after the initial plan is set-up, the client can request an ad hoc payment to be made to the adviser

Ongoing and ad hoc Adviser Charges affect the 5% annual withdrawal limit for Income Tax purposes.

Find out more about Adviser Charging in the Fast Facts document (PDF) for the Prudential Investment Plan.