Annual Endowment statement confusion

I'm a bit confused about my annual standard life endowment mortgage statement. It says that the current value is approx £630 lower than its value last year is that right? I thought the value should be higher after another years payments
Thanx

Lady_K
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Replies

  • edited 30 April 2009 at 11:21PM
    opinions4uopinions4u PPR
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    edited 30 April 2009 at 11:21PM
    Lady_K wrote: »
    I'm a bit confused about my annual standard life endowment mortgage statement. It says that the current value is approx £630 lower than its value last year is that right? I thought the value should be higher after another years payments
    What type of policy is it?

    If it's a unit-linked policy then the value of the units will have fallen sharply and the value of your policy will have sunk with it, despite your premiums being added to it.

    If it's a 'with profits' policy, then any bonuses previously added cannot be removed. The amount guaranteed at maturity will not have fallen.

    But if you decided to cash it in now (which is, presumably, the 'current value' you have referred to) you need to understand that the underlying investments will most likely have fallen quite sharply in the past 12 months.

    There's been a credit crunch don't you know! This is one of the ways it affects us ordinary mortals.
  • Lady_KLady_K Forumite
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    I don't really understand these endowments but I see it says on the 2nd page with profits bonuses if that means anything. I'm not thinking of cashing it in its for my mortgage on my house. Its going to have quite a big shortfall
    Thanx

    Lady_K
  • opinions4u wrote: »
    If it's a 'with profits' policy, then any bonuses previously added cannot be removed. The amount guaranteed at maturity will not have fallen.

    True, but what will have fallen is the cumulative non-guaranteed terminal bonus.These have been dramatically cut over the last 6 months to reflect the falls in all the markts over the past 2 years.Sadly there are probably more declines to come, which is why it may be sensible for those whose policies are nearing maturity to cash in now..
    Trying to keep it simple...;)
  • Lady_KLady_K Forumite
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    Part of the Furniture Combo Breaker
    Well this says

    total current value 1st feb 2009 £10,928,20
    total current value last year £11,599,00
    Amount paid on death £27,000
    Minimum payment at maturity £14,006.99

    This endowmrent ends in Oct 2014

    Theres other calculations but wasnt sure if I needed to put them here
    Thanx

    Lady_K
  • Fiver55Fiver55 Forumite
    16 Posts
    Hi Lady K and Ed Investor, I've just had my statement too and I also didn't understand why the current value should be less. I am thinking whether its best to cash it in and haven't a clue what's the best thing to do.
    Ed Investor, is there any hope for an improvement in the next few years do you think, how can things get much worse?
  • Lady_KLady_K Forumite
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    Part of the Furniture Combo Breaker
    I cant cash mine in because its for my halifax mortgage, it gets from bad to worse what a mess :( I'mm worried sick about the shortfall as its only got till 2014 and if its losing value on top its even worse :(

    I dont understand endowments or what to do for the best but I'm going to find last years statement and compare them I could lose my house thats what I'm worried about
    Thanx

    Lady_K
  • moleratmolerat Forumite
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    My current value was £2k less than last year with another years worth of payments added so actually nearer £3k. If that is the annual statement value you have then it is even lower now. My annual statement was only -£1k. The new projected terminal values were £5k less than last year. The current values can be seen by registering for on line servicing.
  • dunstonhdunstonh Forumite
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    I am thinking whether its best to cash it in and haven't a clue what's the best thing to do.

    Based on the figures you have posted, I cant see why you would think its best to cash it in. Yours seems like its best to keep it.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • POst some more info for a view

    Provider
    Guaranteed minimum at maturity
    Surrender value
    Monthly premium
    Maturity date
    Maturity forecasts
    Mortgage interest rate
    Trying to keep it simple...;)
  • edited 3 May 2009 at 8:35AM
    Lady_KLady_K Forumite
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    edited 3 May 2009 at 8:35AM
    Edinvestor, Not sure who you meant to post this but posted mine anyway

    STATEMENT 2009
    Provider - Standard Life
    Guaranteed minimum at maturity - £14,006.99
    Surrender value (current value) - £10,928.20
    Monthly premium - £33.67
    Maturity date - 27/10/2014
    Maturity forecasts - 3.75% £14,600.00 - 5.50% £15,900.00 - 7.25% £17,400.00 - Target amount £27,000.00
    Halifax mortgage interest rate - Tracker rate 1.240% (1/04/2009) (lasts till 2011 unfixed)

    Difference from last years Annual Statement is

    STATEMENT 2008
    Provider - Standard Life
    Guaranteed minimum at maturity - £13,966.88
    Surrender value (current value) - £11,599.00
    Monthly premium - £33.67
    Maturity date - 27/10/2014
    Maturity forecasts - 3.75% £16,500.00 - 5.50% £18,300.00 - 7.25% £20,300.00 - Target amount £27,000.00
    Halifax mortgage interest rate - 5.990% (1/03/2009) 5.740%(1/04/2008)
    Thanx

    Lady_K
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