Should I cash in my endowment?

Sarahsaver

Hi there, I have a question. I have an 82k mortgage and an underperforming endowment which costs £144.50 pcm. If I cashed it in now I would get about 3.5k at a rough estimate, which if I did so I would pay off a CC as I am aiming to be CC free. Don't use them a lot but there was a patch in the past when i had no other option:(
Anyway...already got compensation for mis selling but ex OH got the money (B**ST**D) Long story, idiotic judge...
Should I therefore cash it in and use the money elsewhere, like paying the 144.50 a month into a high interest account or bonds or something? Whats the best thing to do?

EdInvestor

Hi sarah

I assume you still have an interest only mortgage, which the endowment is supposed to repay at maturity?

Post some info about the endowmwnt

Company it's with
Guaranteed sum assured
Declared bonuses
Surrender value ( ring up and ask)
Maturity date

Projected maturity values @4% etc

Sarahsaver

Yep it is an interest only mortgage.
will have a dig through my paperwork - immense as theres a lot of legal stuff because of the ex OH.
It was allied dunbar, they sold out to someone else didnt they, will get onto the paperwork later thanks;)

ReportInvestor

Oh God. Allied Crowbar . I had a work colleague who could talk the hind legs off a donkey and switched career to this outfit.

Sarahsaver

What about not paying into it but not surrendering it? Anyone had any experience of that?

dunstonh

Making it paid up may be an option if better surrender terms are a year or two away. Many endowments stop charging penalties at year 10 or 15 and it can make sense to wait until that point to avoid the penalty. I have no experience of AD endowments apart from a few years back and I cannot recall much about that (apart from its very high target growth rate).

Sarahsaver

At the mo its about 5k (i misjudged the figures ) which is about half of whats actually been put into it. I have been robbed! They are predicting a 20k shortfall. Barstewards.
I'd have been better off spending half of it on lottery tickets and half in the bank.
It is only in its 6th year.

BACKFRMTHEEDGE

Sarah you have my deepest sympathy. :grouphug: Hope someone is along to help you soon. :A

Sarahsaver

Someone suggested I lower the payments to the endowment but start shoving my cash into an isa instead, sounds like a good idea.
Could I complain to the ombudsman about unfair charges, because I could look atfer 10k for 6 years and it would not cost me 5k to do so :rolleyes:...

dunstonh

Someone suggested I lower the payments to the endowment but start shoving my cash into an isa instead, sounds like a good idea.

This is unlikely to be an option. First the provider would have to allow it, and most dont. Even if they did, you could break the taxation qualifying rules and leave yourself with a potential tax liability.

Could I complain to the ombudsman about unfair charges, because I could look atfer 10k for 6 years and it would not cost me 5k to do so

What unfair charges?

Sarahsaver

That I have put into it approx 10k and if i cashed it in i would get 5k. Those unfair charges!!!;)