Endowments What are my options

MoreMoneypls

Hi can anyone give me advise. I have two Endowments one for 35000 and another for 45000 to cover an £80,000 Mortgage. I have 13 years to run before the Endowments mature. Should I sell the Endowments and get a Repayment Mortgage or hold on to the Endowments. I was looking at borrowing more money say 20,000 for home improvements. But not looking forward to another 25 year Mortgage. Whats my best options of borrowing another 20,000 and still keeping the Endowments.

dunstonh

Are the endowments good ones or bad ones? We can't tell from your post. Give us some details on them and we can give you are views (only views, not advice).

MoreMoneypls

What do you mean good ones or bad. If you mean are there shortfalls then yes there is. approx 6000.

EdInvestor

Post some figs

Companies they're with
Guaranteed sum assured
Declared bonuses
Surrender value
Monthly premium
Maturity date


If they are not WP endowments, post the fund(s) they are in and the projected maturity values.

dunstonh

A shortfall doesn't mean anything by itself. If the shortfall projection uses 3% and ends with a shortfall but your fund is averaging 8%, then the 3% projection is useless.

Also, just after a stockmarket crash, it would not be unusual for a unit linked policy to go into shortfall (on projections) but afterwards return to surplus. That is what is happening currently. Alternatively, you could be on a closed with profits fund with limited potential and not even achieving 3% pa and unlikely to do so in the future. IN which case the shortfall could be worse.

So, we need the info Ed has posted.

EdInvestor

Hi MMP

If you cashed in the first and put the money in the bank@ 4% also paying in the premiums, you would get 18759 at maturity compared with its guaranteed value of 17,905.ot much difference.

The second one looks to be "unitised with-profits", ie no guaranteed value.If you surrendered this one as above, you should get 32,304 at maturity.

Can you post the projected maturity values FP has given you? We really need them for a full comparison, especially with policy 2. Are you sure your shortfall is only 6k?

MoreMoneypls

I contacted FP but they where unable to give me the Projected maturity value because there systems where updating. They said to call back in 2 days
slow system or what.

EdInvestor

Hi MMP

I think your best bet is going to be to surrender these two and remortgage,increasing your mortgage payment by the endowment premiums.The proceeds will fund most of the improvement costs.Try to find one with a lower interest rate and if you need the life cover, be sure to replace it before surrendering the endowments.

MoreMoneypls

Thanks Ed for all the advise you've been very helpful