Endowment valuation NU/Aviva

englisho

I have a Flexible mortgage plus endowment policy with NU/Aviva.

I was fortunate enough to pay off the mortgage a few years ago but saw at that time no reason to cancel the endowment policy and kept it running as simply a nest egg.

I have just received a statement from Aviva with a fund valuation. The valuation is £2000 LESS than the valuation last year and £3500 less than the total I have paid into the scheme over the last 15 years. How can the valuation actually go down yet I've paid another years contributions into the scheme?

I'm sure I remember the guy who sold me the policy saying that the sum I paid into the scheme was guaranteed and that I would not get less back than I paid in. Maybe I'm wrong.

The policy has another 9 years to run. Would it be more sensible to now cancel the policy?

EdInvestor

Post some info about it
#
Guaranteed sum assured
Declared bonuses
Surrender value
Monthly premium
Maturity date
Maturity forecasts

dunstonh

How can the valuation actually go down

You may wish to read up on the effects of recession and the credit crunch. I dont know if that has passed you by or not but it is a major current event and has been for a year now.

englisho

EdInvestor wrote: »

Post some info about it
#
Guaranteed sum assured
Declared bonuses
Surrender value
Monthly premium
Maturity date
Maturity forecasts

Policy Name - NU Flexible Mortgage Plus
NU Investment fund - Aviva Balanced Managed Life Standard Series 04
Units Held - 4,545
Bid price - 2.623

Guaranteed sum assured - £46,000
Declared bonuses - no information on this
Surrender value - currently £11,950 (last year was £13,000)
Monthly premium - £73.71
Maturity date - 2018
Maturity forecasts -
@4% - £23,400
@6% - £27,800
@8% - £33,100

englisho

dunstonh wrote: »

You may wish to read up on the effects of recession and the credit crunch. I dont know if that has passed you by or not but it is a major current event and has been for a year now.

It always makes me chuckle when I am confronted by forum warriors who shoot their mouths off with ignorant comments without reading properly..

My query clearly states that I seem to remember the endowment seller saying that I could not get back less than I actually paid in. I am wondering if this was true.

If you have no valid contribution to my question, I have a suggestion.. Dont reply.

EdInvestor

This appears to be a unit linked policy so it would not have any guarantees.Its value will fluctuate with the state of the markets, which as mentioned have all plunged over the last 2 years.Thus it's completely unsurprising that the policy is currently worth less than you've paid in -you only had about 5 years growth before the dotcom crash and that was probably eaten up by front loaded charges..

But I wouldn't cash it in now, as markets appear to be getting into recovery mode.Hang on for a bit, wait for the value to grow and for interest rates to rise.Then you can dump it and seek security (if that's what you want) in a cash ISA.