What does the Scottish Bond offer?

The Scottish Bond is a great way to make the most of your tax-free allowance. The Government lets you invest up to £25 a month tax free with a friendly society. You can use this tax-free savings allowance even if you already have an ISA. If you don't use it, you simply lose it.

The Scottish Bond is a 10-year investment for anyone aged between 16 and 64. Just set aside an affordable amount each month so that you could have a sizeable lump sum to look forward to. Just imagine, it could help pay for a car or the holiday of a lifetime. However, if you cash in early you may not get back as much as you have paid in.

When you invest with the Scottish Bond, you're saving tax-free in two ways.

• First, unlike most investments and savings accounts, your money grows free of capital gains and income tax. However, the fund cannot claim back tax from dividend income it receives from investments in shares in UK companies.
• Second, you don't pay tax on the payout when your Bond matures.

Your money is invested in the Scottish Friendly With Profits Fund, which invests for long term growth, as well as a degree of security, in the stock market, Government and company bonds and cash.

How much can I save?

You can choose to save £15, £20 or £25 a month or £180, £225 or £270 a year.

How could the Bond grow?

The Scottish Bond offers a convenient way of building your savings and your payout is made up of two parts:

• Firstly, you have the reassurance of a minimum cash sum that is guaranteed when your Bond matures, giving you security and automatic life cover. The guaranteed minimum cash sum, which protects a part of the total amount invested, will depend on your age and the amount you pay each month for the whole term.
• Secondly, your main long-term growth comes from the potential addition of both annual bonuses and a final bonus on maturity. The value of these bonuses depends on the profits of Scottish Friendly and how we decided to distribute that profit back to you. Because we're a mutual organisation, there are no shareholders to take a cut - so all our profits go to our policyholders. Whilst bonuses cannot be guaranteed in advance, once a bonus is added, it's yours to keep at the end of the term, provided you keep up payments for the full term.

Consistently strong past performance

Compare our returns for yourself:

Return on £25 per month invested over 10 years

Our performance has given us a consistent Top Ten rating for our with profits performance (April, 2007). Past performance is not a guide to future performance. If you cash in the Scottish Bond before the end of the term you may not get back as much as you have paid in. Capital values are not guaranteed with this plan although they are in building society accounts where growth potential is more certain and where they benefit from ease of access.

1. Morningstar UK Savings £2,500+ Investment Gross. This is a Morningstar index which measures the performance of the savings accounts of a number of current and ex-building societies over 10 years to 1/10/07.
2. Source: Scottish Friendly. Based on someone starting a plan aged 30 next birthday saving £25 per month. Figures shown are based on a Scottish Friendly 10 year with profits plan maturing on 1/10/07. Based on current tax law which may change. On maturity the investor receives the proceeds free of tax.
3. Source: Money Management, April 2007

Life cover is included

The Scottish Bond automatically includes life cover. The level of cover you receive when you take out your Scottish Bond depends on your age and may be subject to medical conditions. For example, someone taking out a Scottish Bond aged 30 will have a greater level of life cover than someone aged 60. And of course, the benefit of life cover means that if you die, your dependants will receive a cash sum to help them through a difficult time. You should consider if life cover is appropriate for your financial needs

The table below gives an indication of how much life cover you could expect.

Age next birthday	Monthly saving for 10 year plan
	£15	£20	£25
25	£1527	£2072	£2617
30	£1525	£2070	£2614
35	£1520	£2063	£2606
40	£1512	£2052	£2592
45	£1501	£2036	£2572
50	£1478	£2006	£2534
55	£1442	£1957	£2472
60	£1381	£1874	£2367
65	£1269	£1723	£2176

Apply now

Applying is easy. Simply click on the Apply Online Now link, read the Key Features then complete and submit your application today.

When you start saving with us, you'll receive a gift. Choose either a £15 Marks & Spencer voucher or a £15 High Street voucher. Don't forget to select which gift you would like on your application form.

If you are in any doubt as to whether this product is suitable for you please contact your Financial Adviser.

If you apply for this product, for your records, we recommend you print or save a copy of this and any other relevant pages together with a copy of the Key Features.