endowment value for standard life

de1amo

the original tartget was 30000 --is that the promise or would there have been a product specified to the endowment--this endowment is not connected to the original lender(abbey)-i have moved and this relates to the old address and old mortgage,

dunstonh

de1amo wrote: »

the original tartget was 30000 --is that the promise or would there have been a product specified to the endowment--this endowment is not connected to the original lender(abbey)-i have moved and this relates to the old address and old mortgage,

The promise value is tied to the target amount but it was set about 8 years ago. You will need to ask Std Life what the mortgage promise value is. They dont go out of their way to tell you. If you surrender it, they gain the money as they have fully funded the promise value (so anyone surrendering means SL can take money out of that pot for their own use as its not needed for the promise any more). An IFA can find it out as we get given the promise values on our periodic updates but SL should tell you upon request. Usually it is a two figures to highlight a range of what it may be (i.e. between the lower projection and the higher projection). If you are well of course, it may just be one figure as its the same amount for all three projections used.

So, either ask the servicing IFA or std life directly if there is a mortgage promise value on your plan and if so how much is it.

Gorgeous_George

My mate had a similar policy with SL and left it to maturity. There was no terminal bonus, no mortgage promise, nothing. He wished he'd surrendered earlier.

My 'dosh' was put into my offset mortgage savings but this is a tracker and the rate fell to 1.24% so it is now safely sat in a savings bond earning 4.3%. It may soon be used to buy a second BTL (I'm trying to buy a three bedroom house for £45K with an easily achievable £450 per month rent. The house is currently £54K having sold for £90K in 2007).

GG

LeafyBarnet

Recent SL With Profits maturity here. Timelines and figures may be useful for readers.

Feb 2009: MEP estimate 1560 to 2380
Nov 2009: MEP forecast 2150
Jan maturity: MEP payment 2150

Final bonus: 250

I got a return of 3.5% non-taxed compound interest on the 18-year policy. That compares with 20.9% before tax on a 10-year easy access savings account (source: Guardian, Nov 2009).

I also got "free" demutualisation shares during the life of the policy, and a small "loyalty" top up on those.

In the final year of the policy the monthly Basic Value figures rollercoasted but in most months they increased by 300 a month for a 100 per month payment.

One easy recommendation to make: get registered with SL's online service so you can see what's happening monthly. You really can't make a decision based on a printed yearly report.

Thank you to Dunstonh and EdInvestor for their wise words given here over the months and years. The most important perspective on these is that they give confidence to the averagely unknowledgable investor (myself included) to make decisions -- either a decision to change or a decision not to change and see the risks of that.

Final words from the mortgage supplier on closing the mortgage: "thank you for doing business with us". No free hamper then. :cool:

de1amo

Dunsh

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i am slightly confused about what i would do if the mortgage promise amount is high or reasonably half decent!--if i stop the endowment at this point will i receive the mortgage promised amount without completing the full term of the endowment-ie 14 months time-i am slightly confused by your 'speak' of sl gaining from the pot!.-who would be loosing?? i also think if thats the reality isnt it clearly dishonest not to advise someone of this fact/figures when they ask for a valuation -i thought such practices would be of interest to the FSA. -as a share holder i am appalled lol
İ also saw that george got 1100 odd shares for membership when i only recd 838 with the second lot included--george did you have other accounts?? speak up lads

EdInvestor

LeafyBarnet wrote: »

I got a return of 3.5% non-taxed compound interest on the 18-year policy. That compares with 20.9% before tax on a 10-year easy access savings account (source: Guardian, Nov 2009).

Not quite untaxed unfortunately - returns on endowments (and investment bonds)are taxed within the policy at something near the savings rate (typicallly 15-20%). These days using an ISA avoids this.

EdInvestor

de1amo wrote: »

Dunsh

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i am slightly confused about what i would do if the mortgage promise amount is high or reasonably half decent!

You need to post the figures you've been asked for, can't help you in the absenmce of this info.It would not be appropriate to 'stop' the endowment, either surrendering or sellling it or doing nothing will likely be the way to go.

dunstonh

Dunsh

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i am slightly confused about what i would do if the mortgage promise amount is high or reasonably half decent!--if i stop the endowment at this point will i receive the mortgage promised amount without completing the full term of the endowment-ie 14 months time-i am slightly confused by your 'speak' of sl gaining from the pot!.-who would be loosing??

Based on shortfall projections many years ago, Std Life came out with a promise that they would pay an extra amount on the endowment maturity if it fell short of the target.

The amount is based on the individual shortfalls of each plan on a given date (some years ago now). This figure is a maximum they will add and its only paid on maturity. If you surrender you do not get the mortgage promise value.

So, lets say you target figure is £50,000 and your maturity value is £40,000 and you have a mortgage promise value (MEP) of £5000. you would get £45,000 paid out. However, your projections at no point would include that extra £5000.

Using the same £50,000 target and MEP of £5000 but maturity value of £48,000, you would only get £2000 added to the policy as the overall payment cannot exceed the target amount.

i also think if thats the reality isnt it clearly dishonest not to advise someone of this fact/figures when they ask for a valuation -i thought such practices would be of interest to the FSA. -as a share holder i am appalled lol

They are doing nothing wrong. They have with various statements over the years put the MEP value in. However, its never included in the projections or values as it only occurs on maturity and only if the policy falls short. it would be wrong to include it.

de1amo

Just a quickie--i have rung sl as you suggested and i have no cover under the mortgage promise value because my endowment was on target back in those days--the minimum is 17973 with a max 18615 --with a completion dated of may 2011---my premium is 40,60 per month--i am posing the age old question-where do i go now?
i must add that i live aboard and can get a minimum of 6,40pc net on my savings-i have been as high as 17pc before the recent worldwide termoils-if this clouds the matter!!
Dunst et Al please dont leave me with a life of regret!!

de1amo

İ pay 2pc on my svr mortgage --just to bear my soul!-i am a basic tax payer--