NU imposes 22% endowment surrender penalties

dunstonh

If I calculate the return on my Pru WP endowment based on payments only, sure, it's pretty pants, probably close to zero.

I doubt it. Pru have a 100% track record on hitting target at this point. So, that means the net returns are going to be around the 7% pa. mark.

crazydcl

dunstonh wrote: »

I doubt it. Pru have a 100% track record on hitting target at this point. So, that means the net returns are going to be around the 7% pa. mark.

I'm not quite sure what you mean by "net" returns, but I'll carry on in ignorance regardless...

I can only go on the numbers they send me. According to the latest statement, the "Total with-profits value as at 31/12/07" was £8,976. Given that I've been putting in £98.50 per month since Feb 98, I calculate that to be a "return" of -5%.

However, it was originally a Scottish Amicable endowment. The difference between the earliest Pru statement I can find and the latest gives -1.9% "return" over 5 years whilst in the hands of the Pru. Minus signs in both cases!

I guess the only way to calculate a genuine return is to price up non-endowment type life and critical illness cover for 2 and remove it from the premiums prior to calculation. Any benchmark guestimates out there that I can use?

I am hoping that the effects of charges weighted towards the front of the policy and bonuses towards the end improve things by the time it matures in 15 years time. It's encouraging to see the Pru spoken of as one of the "good" policies. What are the others like?

Cheers - Dave

dunstonh

Scot Am are not quite as good as Pru originals but this year scot am have estimated a 98.2% success rate on hitting target. That has been increasing steadily over the years but recent events will probably bring that back down to around 90% in the short term. Still better than many others.

You need to remember that endowments dont get straight line growth. The front loading of charges and volatility of returns means that in the early years the performance will appear worse than in later years.

EdInvestor

crazydcl wrote: »

I can only go on the numbers they send me. According to the latest statement, the "Total with-profits value as at 31/12/07" was £8,976.

Does that include the accumulated terminal bonus?

[Deleted User]

Hi all
I just wanted to pop on and remind you all that the life and pensions helpline number is 08000 686 800 and you will be able to get information about your specific policy.

Hope this helps
Becca