FP Endowment

pgt67

we have a FP endowment since '89 although it will not be used for repayment of any mortgage

Paying £34.42/month
declared Bonuses £3,877.02
Min Guaranteed inc bonuses £12,032.02

4% £12,900
5.5% £13,900
8% £15,900

Just confirmed that making it paid up will ensure £9,604 plus whatever bonuses it gains till maturity in 2014.

The terminal bonus this time around has just dropped to 5% from 17%

Not sure if we should carry on considering the current climate in the hope things improve before maturity or save the monthly payments and make it paid up.

any advice appreciated.

EdInvestor

Please post the surrender value.

If you have a mortgage of any kind, please post the interest rate (irreleveant if not connected to the endowment).

pgt67

Ed

the Surrender value is £8,694

Thanks

pgt67

Sorry forgot to mention there is no mortgage involved

vinr

pgt67 wrote: »

Ed

the Surrender value is £8,694

Thanks

If your endowment has another 5 years to run, the endowment premiums in total will cost you around £2,000. The projected guaranteed sum is said to be £9,600 plus addditional bonuses. If you accept the surrender at £8,694 and shop around for life assurance that without profits will be about the same as what your paying now but without profits. Also, when you shop around you should do a lot better with the surrender value and even then I reckon your better off surrendering now by around £1,000. it all depends on how much you need the money now. I can't see bonus doing much over the course of the next 5 years but they can't take away what bonuses you already have but its your choice, good luck.

EdInvestor

pgt67 wrote: »

Min Guaranteed inc bonuses £12,032.02

4% £12,900
5.5% £13,900
8% £15,900

If you cashed this one in and placed it on deposit @ an average 4% net interest to maturity,also paying in the premiums, you would end up with 12,835.

This is not much more than the guaranteed amount you will get by sticking with the policy. So you may as well do this - you may get lucky with a strong market recovery over the next 4 years and make more: either way, you have little to lose by holding on and of course you have free life cover included.

pgt67

thanks for taking time to look it over