Another Shortfall

EdInvestor

Drac wrote: »

Updated info :

1 - Legal & General
Maturity Forecasts = @ 4% £9,720...@ 6% £10,300...@8% £11,100

If you surrender this policy and use the lump sum to reduce the mortgage, also increasing the monthly mortgage payment by the amount of the endowment premium, at maturity your notional return would be £10,983, which is higher than their projection at 6%.

If you reduce the mortgage now through this method, this will also mean you pay much less interest over the rest of the term, because the amount borrowed is smaller and is being reduced every month through overpayment.Thus the shortfall will get smaller as well..

Please get the forecats for the other policy and I will work it out too.

Drac

Many thanks for your help to date, much appreciated

2 - Norwich Union
Guaranteeed Sum Assured £5,504
Declared Bonuses £4,955.30
Surrender Value £9,771.50
Target amount = £16,000
Current Value = £10,459
Monthly Premium = £25.16
Maturity Date = 05/07/2010


Maturity Forecasts = @ 4% £11,100...@ 5% £11,500...@6% £11,800 and
the shortfalls are £4,900....£4,500 and £4,200 respectively

Interest Rate Payable on Mortgage = 5.79 until 02/2010

EdInvestor

Drac wrote: »

Many thanks for your help to date, much appreciated

2 - Norwich Union

Maturity Forecasts = @ 4% £11,100...@ 5% £11,500...@6% £11,800 and
the shortfalls are £4,900....£4,500 and £4,200 respectively

Interest Rate Payable on Mortgage = 5.79 until 02/2010

If you cashed this one in and proceeded as above your guaranteed return at matiurioty would be £10,646.This is below their forecast at 4% growth, but it is likely that the policy will not actually grow over the next year but fall in value, because of the market falls over the past few years.

Are you entitled to any 'mortgage promise' money on this policy?Also, is it included in the Aviva 'reattribution' programme, under which it would get a special bonus?

You may wish to see if you can get a better payment for these policies by selling them. Get a quote here: www.apmm.org

Drac

Aviva have said, as long as we keep the endowment til the end, we WILL get the maximum 6% - not sure what the reatrribution is??

EdInvestor

Drac wrote: »

Aviva have said, as long as we keep the endowment til the end, we WILL get the maximum 6% - not sure what the reatrribution is??

How much promise money would you be entitled to ?The 6% applies to the growth required on the fund, not to the max payable.

The attribution only applies to some Aviva policyholders so if you've not heard anything aboiut it, you probably aren't one of them.