Endowment advice sought

EdInvestor

Tarama wrote: »

Hi my situation is similar

Please also post

Surrender values
The percentage return you would expect to get if you cashed in and redeployed the money.

EdInvestor

stevenatleven wrote: »

see if the market for selling on still exists,but can,t really see anyone wanting it if there was,nt some large final bonus attached to it.

You can ask for quotes from the whole market here: https://www.apmm.org

kostigovs

Tarama wrote: »

Hi my situation is similar

I have 2 endowments and essentially I am retaining them for the same reasons and I would welcome any ideas around these.

The first is with Prudential/ which was Scottish Amicable and it commenced August 1990. Its current value is £18395.

Guaranteed sum assured - £12075
Declared bonuses - £6400
Monthly premium - £46.85
Maturity date - June 2015
Maturity forecasts
-4% = £23,300
-6% + £26,00
-8% = 29,000



The second is with Friends Provident and was commenced in 1997 to mature July 2015. It provides life cover of £57,533. Its value on 13.11.09 was £23391

Guaranteed sum assured - I cannot see anything on the literature re this
Declared bonuses - none that I am aware of. It states "We may pay a final bonus when you end your plan (this is something I need to check).
Monthly premium - £163.90
Maturity date -July 2015
Maturity forecasts
-4% = £38,700
-5% = £41,800
-8% = 47,200


many thanks

I would think that the G.S.A and declared bonuses will be on your annual statement. I had an endowmnent with FP for many years and the information was supplied on the annual statement.

As an aside I found FP very helpful in supplying information when I was deciding whether or not to continue monthly endowment payments

Tarama

kostigovs wrote: »

I would think that the G.S.A and declared bonuses will be on your annual statement. I had an endowmnent with FP for many years and the information was supplied on the annual statement.

As an aside I found FP very helpful in supplying information when I was deciding whether or not to continue monthly endowment payments

Thank you for this.

Did you continue or surrender the policy? I will check the GSA today

stevenatleven

EdInvestor wrote: »

Post some more info about the endowment

Guaranteed sum assured
Declared bonuses
Monthly premium
Maturity date
Maturity forecasts (ring up and ask for these).
Expected return (%) if cash is redeployed to other savings/investment

Here are the figures that I aquired today
Guaranteed sum assured - £11886
Declared Bonus - £5289
Monthly premium - £24.13
Maturity date - 19/4/2013
Maturity forecasts 4% = £12200 6% = £13100 8% = £13900
Expected return - if by this do you mean the best I could get with the cash surrender value which today is £10200. I could probably find a bond
at 4% which would grow to approx £11500,but there would also be the premium saving over 40 months which is £965.

I could also make the endowment paid up with a value in April 2013 of £11170.

kostigovs

Tarama wrote: »

Thank you for this.

Did you continue or surrender the policy? I will check the GSA today

I treated it as paid up and paid off my £50K mortgage

EdInvestor

stevenatleven wrote: »

Here are the figures that I aquired today
Guaranteed sum assured - £11886
Declared Bonus - £5289
Maturity forecasts 4% = £12200 6% = £13100 8% = £13900

These figures don't look right. The guaranteed value - ie what you are certain to get at maturity if you keep paying the premiums - is the sum of the GSA and the declared bonuses, ie £17,175 in your case.So the maturity forecasts will typically be around that figure, or somewhat higher at the bigger growth rates.Perhaps you could check.

stevenatleven

Edinvestor,I think I have misunderstood by adding the bonus and the sum assured together,thinking that was the guaranteed sum assured.

One of the statements I have has the following info
Sum assured £6597
Declared Bonus £5289

When I talked to the advisor today I asked what was the least i was likely to get and we came up with a figure of £11886,I think if there was a bonus of £5289 to be added he would have said.But I will check.

Hope this is clear.

EdInvestor

stevenatleven wrote: »

Maturity forecasts 4% = £12200 6% = £13100 8% = £13900

OK, that explains it.

So, if you took the surrender value and saved it in something guaranteed @4% over the period to maturity, also paying in the endowment premiums, then your return would be £12,358, higher than their projected amount.

So there is no point in holding on to the endowment unless you would have a problem replacing the life cover.There is no premium in the policy any more for taking a risk, unless you expect the policy to perform at 6% or 8%.

If you want to make a further check on the investment outlook, you would need to find out the investment mix of the Clerical Medical WP fund - how much is invested in equities and property vs cash and bonds. They should be able to tell you this on the phone.

Post the figures on here and we can give a view on the potential in that area.

stevenatleven

Edinvestor,many thanks for your comments.I will get the figures from CM
tomorrow and post them
I really can,t see them achieving 8%, and I have requested the surrender forms.