Offset mortgages and endowment policies

Mental_Mentor

Hi, I'm new to the board and looking for some advice. I currently have an offset mortgage with First Direct but am not sure whether I'm making the most of this. I currently have 2 endowment policies which are due to mature in 2023 and have made about £10k worth of payments to it. Can anyone please tell me whether I should cash them in, put the money in a first direct savings account and offset against my current mortgage? Projected growth on endowments is 5.45%

EdInvestor

Post some info about them

Company(s) they are with
*Guaranteed sum assured
*Declared bonuses
Surrender value
Monthly premium
Maturity date


*If you don't have these, post instead the projected maturity values @ 4% and 6%

Mental_Mentor

Thank you for replying. Details as follows:

Both plans with Abbey

Plan 1
Guaranteed sum assured £59,741
Target amount: £59,741
Projected growth 5.75% = £41,500 (I doubt this)
Monthly premium: £91.87
Maturity date: 1 March 2003
Not sure of surrender value but plan started March 1998

Plan 2
Sum assured: £17,539
Target amount: £17,539
Projected growth: 5.75% = £14,000 (I doubt this)
Monthly premium: £33.96
Maturity Date: 14 May 2023
Not sure of surrender value but plan started May 1998

Mental_Mentor

EdInvestor wrote:

Post some info about them

Company(s) they are with
*Guaranteed sum assured
*Declared bonuses
Surrender value
Monthly premium
Maturity date


*If you don't have these, post instead the projected maturity values @ 4% and 6%

Posted the details, does anyone have any advice.

Thanks

EdInvestor

HI MM

Sorry I missed your post.Need the surrender value to make any comment.

Mental_Mentor

OK! will do. Thought no-one loved me anymore!

Mental_Mentor

Sorry for delay. Thanks for your help.

Surrender values as follows:
Plan 1: £7230.84
Plan 2: £2058.65

Mental_Mentor

Hi Edinvestor

Think I went about reply the wrong way but here goes:

Surrender values

Plan 1: £7230.84
Plan 2: £2058.65

Thanks
Mental Mentor

EdInvestor

Hi MM

If you cashed in the endowments and put them in the offset account at an interest rate of 5% also paying in the premiums to maturity you should get a return of 45,866, compared with their forecast of 41,500 on policy 1.

On policy 2 the outcome would be 15,543, compared with 14,000.

Some of the difference is accounted for by the life cover, the rest will be charges.I see no point at all in taking risk for a projected return lower than the cash/offset, unless it is essential to keep the life cover.

Mental_Mentor

That's great Ed Investor. Thank you