From 1 January 2003 Legal & General will be cutting their ˜interim" with profits bonus rates for some income bonds. The with profits distribution bond is also caught in the cut. The interim bonus is the bonus that is paid following the last declaration and before the new one - a sort of in-between bonus.
Due to the bonus cuts Legal & General wrote to us stating that clients taking income withdrawals in line with the bonuses declared should reduce them. This is because the bonuses will be lower from 1 January 2003 and if the same levels of withdrawals are taken, clients will be eating into their capital.
If you have investments and take withdrawals based on the levels of bonuses declared, make sure that you are not taking too much and eating into your capital without wanting to.
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