Performance of equity-based SSIAs on the rise

A TYPICAL equity-based Special Savings Investment Accounts (SSIA) is now showing a value in excess of contributions invested, including the Government contribution, compared with a deficit of almost 10% this time last year, the latest findings show.

Actuarial consultancy Life Strategies yesterday released its second annual report on SSIAs, which showed that equity-based SSIAs performed strongly in the last year, in contrast to their poor performance in the previous year, since the SSIA scheme closed.

Over the last year, equity-based SSIAs have returned the strongest performance of the three different types of accounts and a typical equity-based SSIA is now showing a value in excess of contributions invested compared with a deficit of almost 10% this time last year.

As a result, the estimated maturity value has increased compared with the estimated value from one year ago.

Fixed rate accounts were clear leaders this time last year. However, with the ground made up by equity accounts, the value of a typical fixed rate account is currently similar to that of a typical equity-based SSIA. Looking forward, The estimated maturity value is still the highest when the effect of charges on the equity-based SSIA are taken into account.

Variable accounts have fallen into third place, both in terms of current values and estimated likely values. However, values are still ahead of contributions invested and all account holders who have continued to pay into their SSIAs have enjoyed the 25% Government contribution.

Life Strategies director Jim Murphy, said: “The improved performance in equity markets has acted as a fillip for equity-based SSIA products.

However, there’s no guarantee that equity returns will continue their upward tend and the bumpy ride to date serves to underline the volatility of returns on these types of accounts.”