Australian Unity today launched an innovative new investment product
FuneralPlan Bond. With growth-oriented investment options the Bond is
designed to provide returns greater than inflation and an option for
investors not requiring a capital guarantee.
Unlike any existing product in the market, the FuneralPlan Bond provides
two new investment alternatives for investors—moderate and conservative
options—that are linked to the performance of financial markets, in addition
to the existing capital guaranteed option.
Greg Bird, National Manager – strategy, at Australian Unity, said the new
moderate and conservative options were designed for those wanting to
access investment options that were likely to outperform the traditional
capital guaranteed portfolio.
“While the capital guaranteed investment option is a low risk option in the
short term, the risk is the value of the bond may not keep up with the impact
of inflation over a longer time frame,” Mr Bird said.
“Funeral costs continue to rise, so it is important to generate the level of
growth in the policy value anticipated for covering the costs of a funeral
when the service is needed.
“The longer we remain in a low interest environment, the greater the impact
to a capital guaranteed option in maintaining the level of growth required to
meet longer term objectives.
The FuneralPlan Bond’s conservative investment option is designed for those
wanting a combination of capital growth together with relatively stable
returns, while the moderate investment option has a higher level of
variability in returns along with higher potential returns. Both options are
better suited for a longer-term horizon, and typically funeral bonds are held
for 7 years or more.
The FuneralPlan Bond also provides an opportunity to tap into new markets,
according to Mr Bird.
“Traditionally funeral bonds had a limited structure and market and were
sold to senior Australians seeking to meet future funeral expenses with the
security of a capital guarantee”, he said.
“The appeal to seniors is bolstered by tax and pension consessions attached
to funeral bonds”
“Establishing an alternative growth style investment option may provide an
incentive for a younger market to consider a funeral bond product”, he said.
Mr Bird said the FuneralPlan Bond with growth options was the result of
extensive industry and market research.
The issuer of the FuneralPlan Bond is Lifeplan Australia Friendly Society Limited, ABN 78 087
649 492, AFS Licence No. 237989, a leading provider of tax effective investment products such
as investment bonds, education bonds and funeral bonds. The Disclosure Document is
available via the website at fpmanagement.com.au, and the information in this document is
general information only and does not take into account your personal objectives, financial
situation or needs.