FP Endownment

dunstonh

This is is unit linked endownment - can anyone help with this I spoke with FP and even they couldnt expalin how the bonuses work.

If its unit linked you dont get bonuses. The vlaue in in the units which flucuate on a daily basis.

FP have a fairly good internal fund range and the unit linked funds tend to be quite cheap. From an investment point of view, it could be a good time to be paying regular contributions as you are now buying units back at 2003 prices.

T4LFR

So just keep paying and see what we get back at the end...

My instinct is to cash in and pay extra to mortgage rather than maybe get a good pay out at the end of the endownment term

dunstonh

So just keep paying and see what we get back at the end...

I would want to see the funds list and alter the funds personally. However, thats based on my knowledge.

My instinct is to cash in and pay extra to mortgage rather than maybe get a good pay out at the end of the endownment term

I'm doing both. I have increased my mortgage payment and I have increased my monthly amount into investments. Don't see why one should be exclusive of the other.

EdInvestor

If this is a unit linked endowment ( not unitised With profits) then now is a bad time to sell as markets are low and you are also paying a low interest rate on your mortgage so returns are low on that too.

This type of endowmwnt will bounce back quickly when markets recover. Cashing it in would also be more sensible if your mortgage interest rate is higher.

Review the position in a couple of years' time.

T4LFR

Got some info from FP which is as follows -

Cash in value right now is £5711, but payed in £7737

At the moment the maturity value is £20100 (in 2024) at which point i would have payed in 19800!!!

So question remains, do I cash in or do I stop paying right now - when the projection is if the 7737 payed in grows at 4% it will be worth 8830.

Ultimately taking the £66 a month and reduce my mortgage term or over pay???

T4LFR

...

BlondeHeadOn

EdInvestor wrote: »

If this is a unit linked endowment ( not unitised With profits) then now is a bad time to sell as markets are low and you are also paying a low interest rate on your mortgage so returns are low on that too.

This type of endowmwnt will bounce back quickly when markets recover. Cashing it in would also be more sensible if your mortgage interest rate is higher.

Review the position in a couple of years' time.

You've already had the answer, as above.

I have a unit-linked endowment as well, and decided not to cash it in as now is a bad time to sell. I'm hoping for a bounce in its value when the markets recover, as EdInvestor says.