Investors Trust S&P 500 Savings Plan

An independent review by our team of experts.

Review summary

Investors Trust S&P 500 Savings Plan

Investors Trust is an international insurance company licensed and regulated by the Cayman Islands Monetary Authority.

Investors Trust specialises in the provision of medium to long-term investment-linked products tailored to meet the needs of investors around the world, and delivers a range of flexible, tax-efficient products including regular and single premium annuities, designed to suit various income levels and financial planning needs.

With service offices established to support plan participants around the world but not in the UK, USA or EU, Investors Trust seeks to provide opportunities to its plan participants through access to the global financial markets.

Investors Trust are not a large company by international standards and given that they are based out of Cayman, with its lack of regulatory enforcement and protection, is a red flag if the company were to suffer any financial set-backs.

Overview

Investors Trust is an international insurance company, specialising in medium to long-term unit-linked investment products for expats.  They are licensed and regulated by the Cayman Islands Monetary Authority.

The Investors Trust S&P500 Savings Plan is a contractual offshore regular savings plan.

If an investor fulfils the contractual terms they sign up to, the plan provides a guaranteed return at maturity of 140% of premiums paid, or the S&P500 market upside if greater.

The S&P500 Savings Plan was launched in 2004.  If you sign up to it you are contracted to save an agreed amount, from US$200 per month, on a regular basis for a fixed 15 year term. 

An Investors Trust S&P500 Savings Plan should not be taken out unless you fully intend to contribute for the full term agreed, and at the agreed premium payment frequency.

This savings plan is actually a regular premium life assurance scheme, issued under Investors Trust Assurance SPC’s Cayman Islands insurance license.

Your returns are linked to the S&P500 index, or the guaranteed return of 140% of premiums paid if higher, and there is no switching allowed.

If you miss more than 90 days’ premiums then your invested amount will just track the S&P500 and no guarantee will apply.

Investors Trust has a segregated portfolio structure in the Cayman Islands, which they say gives investors

“100% security via an independent third party custodians’ nominee trust account.”

 In terms of fees and charges, there is an annual administration charge, a policy fee and an asset management charge, as well as a bid/offer spread below US$6,000 per annum.

If you surrender early before the 15th anniversary, an early surrender charge applies.

There are no credit card charges on any card including Amex, and there aren’t any other hidden costs.

You can apply and manage your account online and in multiple languages.

This regular savings plan is structured very differently to most of the usual offshore contractual savings plans, but its underlying structure and guarantee mean that it is only suitable for lower risk investors.

The pros

  • Superficially highly attractive
  • Potential for better than bank rate return if all contributions are made throughout the term
  • Lack of flexibility may encourage discipline of saving

The cons

  • Inflexible
  • Opaque and complex charging structure
  • Expensive way to invest
  • Easily mis-represented at the point of sale
FAQs
What are the Investors Trust S&P 500 Savings Plan fees and charges?

Annual Administration Charges: 1.7% years 1 – 15. Bid/Offer Spread: 2% of each contribution on plans under USD 6,000 per annum.

Policy Fee: USD 7.00.

Asset Management Fee: 0.125% monthly of account balance.

Early Encashment - Equal to the sum of the annual administration charges due for the remaining contract years at the time of surrender.

What’s the investment choice?

None: 100% participation in the S&P 500 with principal protected. 140% Guaranteed at maturity

What are the minimum contributions

USD 2,400 annually

Is the Cayman Islands a safe jurisdiction?

The Cayman Islands lack regulatory enforcement and protection for investors which is a red flag as far as we are concerned - think carefully about what recourse you'd have if the company were to suffer any financial set-backs.

Customer reviews
Why would anyone sign up for a 15 year savings commitment?

That's what I asked the bloke who tried to sell me this. He pushed on about the guaranteed return and so on, but as I said to him - I don't know where I'll be or what I'll be earning in 1 year let alone 15.

I took out the S&P500 savings plan and was quite happy for the first year.

But then I realised it was totally inflexible, expensive and NOT what I wanted at inception. I wanted something better than a bank account but low risk. That's what this was sold to me as. But really, if you don't keep going with it it becomes more and more expensive in real terms.

Expert verdict
Expert Assessment of Investors Trust S&P 500 Savings Plan

Although this product is in some ways more attractive than other variants, this entire family of product (contractual savings schemes) have in our view now been superseded by other more attractive options.

More cost effective, more flexible and less complex options are now available for discerning investors.

If you already have an Investor Trust Evolution Savings Plan from Investors Trust SPC and it is worth £50,000 or more, we recommend you have a free, no obligation X-Ray Review™ analysis conducted to give you the information you need to make a decision on the best way forward.

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“With this sort of service you also expect to be paying very high fees, but it’s just not the case. I would definitely recommend AES.”

Jake van den Dries

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