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Personal Equity Plans: There's life in the old PEP yet

How to pick the right one amid the marketing frenzy

Isabel Berwick
Sunday 31 January 1999 00:02 GMT
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OVER the next six pages we will be taking a broad view of the last PEP frenzy. It's a daunting subject and we haven't got room to cover all the angles here.

But we have tried to make it as straightforward as possible and useful for everyone from experienced investors to those who aren't sure what a personal equity plan is (but think they ought to have one).

This survey will get you started on the search for a good PEP buy. Once you have found out more you may decide to give PEPs a miss altogether this year. And you can still afford to do that; whatever the ads may say, this is not a panic situation.

On 6 April this year the PEP saga comes to a halt, only to be replaced with ISAs (individual savings accounts). You probably have no idea what an ISA is, but by the time April comes we will be blitzed with information. We've outlined the main points you need to know about PEPs and ISAs in the article below.

The reason you don't need to panic is that you will be able to invest in a stock market-based ISA in the same way as a PEP. Fund management companies are simply changing their computers to run ISAs instead of PEPs, and if you have a regular savings PEP you may already have received a letter asking for your permission to carry on taking payments in the new ISA account. There should be no extra charge for the change-over. If you think you are being charged to swap into an ISA talk to the fund manager and ask for an explanation.

`The Independent' has just published a free guide to PEPs, sponsored by Scottish Widows Fund Management. Written by my colleague Nic Cicutti, it covers everything you might want to know about PEP investment and lists leading managers.

For your copy call 0345 678910.

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