Where to invest my (depleted) endowment payout?

Pennywren

I am due to receive a very disappointing (needless to say) endowment lump sum. If I still had my mortgage I would be very worried right now. It was declared that I was miss-sold the endowment policy in 1984 and was awarded compensation of - wait for it - £0.00 . Anyway I am expecting the grand total of around £17,000 (having initially expected something closer to £45,000) and I would be grateful for any advice on the best investments to consider.

dunstonh

It was declared that I was miss-sold the endowment policy in 1984 and was awarded compensation of - wait for it - £0.00 .

That would mean at the point of complaint you were not financially worse off.

would be grateful for any advice on the best investments to consider.

tens of thousands of options available with that criteria.

How much risk?
What sort of timescale?
How would you buy?
what is your experience?

Pennywren

Thanks for your reply. The basis on which it was sold was that it would be a good savings scheme providing a significant lump sum together with mortgage cover/repayment - it has not provided either of these. I believe that I am financially worse off than I would have been had I not taken out this expensive endowment mortgage. Surely the fact that it was miss-sold at all should entitle me to some compensation - regardless of my financial situation at the point of complaint?

I think I was really asking where I could best invest the lump sum until I decide what to do with it - so, no risk; short to medium term timescale; not a lot of experience.... Would appreciate any views...

EdInvestor

Pennywren wrote: »

Thanks for your reply. The basis on which it was sold was that it would be a good savings scheme providing a significant lump sum together with mortgage cover/repayment - it has not provided either of these.

Unfortunately you can't claim for poor performance - and certainly not if you haven't made a loss.

I think I was really asking where I could best invest the lump sum until I decide what to do with it - so, no risk; short to medium term timescale; not a lot of experience.... Would appreciate any views...

Probably best to check out the top savings accounts.

dunstonh

he basis on which it was sold was that it would be a good savings scheme providing a significant lump sum together with mortgage cover/repayment - it has not provided either of these.

Doesnt matter. Unless you can prove you were told that, then you have the standard redress calculation which checks to see if you were financially worse off or not. Your figures show you were not financially worse off. Being told you could get back 3 times more than the mortgage is not a mis-sale. Being told you would get back 3 times more than the mortgage is. 10-15-20 years on from the sale point, which was said; "could" or "would"? Can you really be sure? Plus, you could make any false claim when complaining when its just verbal which is why there is a reliance on documentation. In your case, it sounds like the documentation was not good enough to support the firm but you were lucky enough at that point not to be worse off.

I believe that I am financially worse off than I would have been had I not taken out this expensive endowment mortgage.

For most people, the endowment mortgage was £5-£10pm cheaper than a repayment mortgage. Indeed, that was the most common reason for doing with an endowment mortgage.

Surely the fact that it was miss-sold at all should entitle me to some compensation - regardless of my financial situation at the point of complaint?

No. That isnt how redress/financial compensation works. A mistake happened but its a mistake that made you better off than going with the alternative. You complained that you would have gone with a repayment mortgage. The company reviewed you complaint. Found they couldnt support their adviser based on the documentation and agreed with you. However, when they calculated your loss they found you were not worse off but better off due to that mistake.

They have not asked you for the money back so in a way you have been paid a form of redress.

I think I was really asking where I could best invest the lump sum until I decide what to do with it - so, no risk; short to medium term timescale; not a lot of experience.... Would appreciate any views...

Doesnt sound like you want to invest it but save it. In that case stick to savings accounts

Pennywren

dunstonh wrote: »

For most people, the endowment mortgage was £5-£10pm cheaper than a repayment mortgage. Indeed, that was the most common reason for doing with an endowment mortgage.

Sorry - I missed out the fact that this was actually a 'with-profits endowment policy' - does this change anything?

Thanks - I will stick it in a savings account for the time being (probably a one year fixed interest bond).

dunstonh

Sorry - I missed out the fact that this was actually a 'with-profits endowment policy' - does this change anything?

No. That is a type of investment fund. Mostly obsolete nowadays (bar a few exceptions). For many years, with profits was the mainstream way of investing. That was really all the typical consumer could access and for many insurance companies its all that they retailed.