L&G Endowment - Sell or Hold?

msmnc

I have the following Endowment Policy with Legal & General which i have been looking into selling but before i finally decide would appreciate some input from knowledgable sources as to whether this is the right thing to do.

Details:
Start Date: May 1994
Policy Term: 20 Years
Basic Sum Assured: 11058
Current Bonus (at 31/12/05): 3023.90
Gross Premium (monthly): 54.14
Surrender Vale (last week) 10408.90
Guaranteed Sum Assured 24250
Maturity Projections:
@4% 18200
@6% 20900
@8% 23700

I have received an offer of 12000 to sell the policy , which compared to my outlay , looks OK to take & reinvest the premiums etc elsewhere. I do not necessarily need this policy as i now have a split endowment / repayment mortgage which should basically be covered by other policies. I do not need the life cover either. Hope this is all the info required & someone can help me out there.

Thanks

EdInvestor

msmnc wrote:

Maturity Projections:
@4% 18200
@6% 20900
@8% 23700

I have received an offer of 12000 to sell the policy , which compared to my outlay , looks OK to take & reinvest the premiums etc elsewhere. I do not necessarily need this policy as i now have a split endowment / repayment mortgage which should basically be covered by other policies. I do not need the life cover either. Hope this is all the info required & someone can help me out there.

Thanks

If you surrendered this policy and put the S/V on deposit @ a net 4%, also paying in the premiums to maturity, you should end up with 20,343, which is almost as much as L&G's projected maturity value at 6% growth, which is roughly what you might expect their WP fund to achieve.

There is no premium for having the money at risk in a stockmarket- linked fund. It would be better to sell it and either seek a better guaranteed return by using the money to reduce the size of the mortgage,or a better risk-based investment with lower charges in quality funds.