Endowment - Cash in or Keep it going ??

wannabemoneysaver

Can any of you kind , learned people give me some advice as to whether I should cash in my endowment or keep going with it? I've read similar posts on here so I think I know what info I need to post, so here goes :

£111,000 o/s mortgage on life time tracker (0.24% over bank of England base) left on mortgage. Nominally 17 years left on it (I'll probably try to pay this off in about 10 yrs, God willing.)

Originally endowment was for £42K, but because it looked iffy, I converted £12K to repayment, so now I have about £81K repayment and £30K endowment.

Endowment was originally taken out in Dec 1995 with Royal and Sun Alliance. It was a Low-start type. Now in the hands of the Phoenix group.

I am paying £100 per month.
Surrender value obtained this week is : £15354.00
"Guaranteed Death Benefit" : £42000. (Largely irrelevant, I am in a company pension scheme with death benefit)
Maturity Date : 1/2/2015
"Basic Guaranteed Sum Assured" : £17808.00
"Plus previous bonuses of" : £3870.79
"This year's bonus" : £54.20
"Total plan benefits" : £21732.99

"Annual Bonus paid 2007" : 0.25% of basic guaranteed sum

I have 2 options. Keep it going and pay in another 79? x 100 = £7900.00 to get back what? , I don't know...depends on these mystical "final bonuses" ?

Cash in and get £15354.00 - Is this subject to CGT or other tax ?

Would I be better cashing it in, converting it all to repayment, paying the 15K
off the debt and £100/month overpay the mortgage?

I can't believe what these firms are getting away with:mad: , but I'm stuck on the hook now. I would be extremely grateful to hear what you folks think...:T

EdInvestor

Please post the maturity forecasts for the endowment.

wannabemoneysaver

The maturity projections are :

If growth is 3.25% 26700.00
4.00 % 28000.00
5.00 % 29800.00
:eek:

EdInvestor

wannabemoneysaver wrote: »

The maturity projections are :

If growth is 3.25% 26700.00
4.00 % 28000.00
5.00 % 29800.00
:eek:

OK, so if you cashed this one in and used the lump sum to reduce the mortgage owed, also increasing the monthly mortgage payment by the redundant endowment premium, at maturity you would end up with 32,072, comfortably beating all their forecasts and with no risk..

Bit of a no-brainer really.

Lipstick_2

EdInvestor wrote: »

OK, so if you cashed this one in and used the lump sum to reduce the mortgage owed, also increasing the monthly mortgage payment by the redundant endowment premium, at maturity you would end up with 32,072, comfortably beating all their forecasts and with no risk..

Bit of a no-brainer really.

But what about the life insurance for £42,000 that would be lost?
Should that not be factored into the equation?