Octopus IHT saving scheme
Discussion
It's an ok provider, well publicised and popular, assuming that BPR is the best way ahead. There are lots of others out there, I've just done some research for a client and the Downing scheme was agreed to be most suitable in this particular instance (client is an engineer who took an informed view on alternative (aerobic) energy production which that particular investment centred around). There are about 8 decent providers to choose from (imo) and they all have benefits and downsides that may apply to your parents.
As a client facing proposition, generally, Octopus is client friendly, mainstream and established.
As a client facing proposition, generally, Octopus is client friendly, mainstream and established.
Decent outfit as has been said by Ginge, in fact a few ex-collaegues worked for them at one point or another.
Downing as mentioned also decent in the space and Ingenius as well.
I'd hope you, and your parents, are taking advice around this as the BPR route can be spicy from an investment risk persepective, although the timescale and tax reliefs potentially available are very nice.
Not the cheapest route to take either.
Downing as mentioned also decent in the space and Ingenius as well.
I'd hope you, and your parents, are taking advice around this as the BPR route can be spicy from an investment risk persepective, although the timescale and tax reliefs potentially available are very nice.
Not the cheapest route to take either.
Edited by ellroy on Saturday 19th July 07:53
Thanks to everyone who has replied. All comments are very helpful.
The upside is early access to IHT shelter - my father is 86 and my mother is 81.
Downside is costs of entry and management. Target performance at 3% pa is only modest. The provider seems to take big fees and management charges to share in the IHT benefits which can be considerable.
On the issue of risk, they are not looking at the AIM investment. The fund has been going in excess of 6 years and has always delivered 3% pa to investors. The risk appears to be moderate.
It seems that Octopus are a recognised provider in the market.
The upside is early access to IHT shelter - my father is 86 and my mother is 81.
Downside is costs of entry and management. Target performance at 3% pa is only modest. The provider seems to take big fees and management charges to share in the IHT benefits which can be considerable.
On the issue of risk, they are not looking at the AIM investment. The fund has been going in excess of 6 years and has always delivered 3% pa to investors. The risk appears to be moderate.
It seems that Octopus are a recognised provider in the market.
London GT3 said:
Thanks to everyone who has replied. All comments are very helpful.
The upside is early access to IHT shelter - my father is 86 and my mother is 81.
Downside is costs of entry and management. Target performance at 3% pa is only modest. The provider seems to take big fees and management charges to share in the IHT benefits which can be considerable.
On the issue of risk, they are not looking at the AIM investment. The fund has been going in excess of 6 years and has always delivered 3% pa to investors. The risk appears to be moderate.
It seems that Octopus are a recognised provider in the market.
My account manager was in at the start of the week from Octopus. I'm not sure if it's the same with IHT AIM, however, I know with the IHT ISA's they're currently waving the the 2.5% fee (client doesn't need to pay), not sure how this works if you're going direct though?The upside is early access to IHT shelter - my father is 86 and my mother is 81.
Downside is costs of entry and management. Target performance at 3% pa is only modest. The provider seems to take big fees and management charges to share in the IHT benefits which can be considerable.
On the issue of risk, they are not looking at the AIM investment. The fund has been going in excess of 6 years and has always delivered 3% pa to investors. The risk appears to be moderate.
It seems that Octopus are a recognised provider in the market.
London GT3 said:
Downside is costs of entry and management. Target performance at 3% pa is only modest. The provider seems to take big fees and management charges to share in the IHT benefits which can be considerable.
Octopus is pricy, most BPR based IHT schemes are - while not untypical, high fees and more importantly, compounded effect of high fees are a big potential detractor (especially if your mum and dad are in good health). Octopus isn't particularly much better or worse than most of their competitors in this space in terms of investment returns - due to the nature of the beast.Invariably, a pretty hefty initial fee and ongoing annum management charge are pretty much par for the course. Providers know that many people like you will be keen to get things rolling so can play hard-ball. You could negotiate it down by going direct, and if you can't, then do you know an adviser who can rebate/share some of those charges?
But whatever you do, really dig deeply into the underlying investments - Octopus has been doing it for a while, and the low promulgated returns imply lower risk but they're not guaranteed - the implicit marketing is rather seductive (yes sir, we know it's low but isn't it better to be safe than sorry?). Rockpool, in comparison, advises that it targets 5% and defers management charges until death (lots of plus and minus points to consider *there*!).
Forgive me for saying so, if your mum and dad are sprightly enough to survive 10, 15, 20 years, then the costs create an increasingly greater hurdle and have you considered what your objectives at outset are and what your exit strategy might be? These investments are like all others, performance has to be monitored.. nothing could be worse than saving 40% IHT by investing in something where the capital value drops 50%.
There are quite a few others out there, I was surprised the other month when doing some cyclical due diligence just how wide the spectrum in investment management approach was when they responded (well, most of them!) to my questions. One provider took months but when they eventually did come, the answers were biblical and encyclopedic in the scope of their thouroughness. Just make sure that BPR is the route for you and consider a variety of approaches, not just one.
Finally, I don't know if you have an adviser or if you have formed a poor opinion of 'em, but if you want to do the research yourself and need a steer with the bigger picture, then practically all advisers will offer a free consultation. To maximise benefit during the session explain before you start that you simply want to discuss the very latest in IHT mitigation.
Edit: Info -
http://www.rockpool.uk.com/inheritance-service/
Edited by Ginge R on Saturday 19th July 07:21
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