Questioning the benefits of exiting with-profits funds

To date investors have done well from exiting closed with-profits funds because of good stock market performance, but going forward this will be less certain

Unlike the majority of IFA firms, we have never recommended with-profits funds to our clients. Even so, we have found ourselves frequently involved in the difficult process of deciding whether or not a client should leave a with-profits fund. Closed with-profits funds often present the greatest dilemma and the difficult decisions often boil down to a game of playing the percentage chances. Over half of the 104 with-profits funds in the UK are now closed to new business, and many of those still open are writing little business. Some of the biggest names in the financial services market have...