Old Mutual International (OMI) has combined its Lifestyle Trust and Select Bond solutions to create a new product for the UK marketplace.
The Select Lifestyle Bond is a trust-based solution designed to help customers achieve a “balance between access to capital, inheritance tax planning and control over the future distribution of assets”, OMI said in a statement announcing its launch.
By using the Select Lifestyle Bond, customers can access a pre-agreed proportion of the trust fund for their own future use, but as they approach each payment date they can make the decision on whether or not to take the entitlement.
If the customer decides not to take the entitlement, or postpones the entitlement, the money stays within the trust and will continue to be outside their estate for inheritance tax purposes.
The Old Mutual International Trust Company will automatically be appointed to run the trust. The Select Lifestyle Bond offers the same benefits of the new Select Bond launched earlier this year, with no initial, dealing or transaction charges and premiums of £20,000, making the solution accessible to more customers.
Peter Kenny, pictured left, managing director, Old Mutual International, said: “At a time when offshore bonds for UK customers are becoming increasingly important, we continue to lead the market with our focus on new innovative solutions.
“Advisers and customers want simplicity, value, transparency and flexibility, and this new Select Lifestyle Bond combines the successful elements of the Lifestyle Trust with the Select Bond to form a truly compelling solution.”
‘Increased life expectancy’
Rachael Griffin, head of trusts & technical solutions, Old Mutual Wealth, said: “With the increase in life expectancy and growing care costs, it is becoming more difficult for people to predict what their income requirements might be in the future.
“Trusts which provide flexibility to adapt to the customer’s changing needs, enabling them to choose whether or not to take withdrawals from the trust, will undoubtedly grow in popularity, and help break-down the barriers that people may have to using a trust-based solution.”