where to look for an endowment policy

dave1140

I am currently on an interest only mortgage and need to look at setting up an endowment to pay back the capital. I don't really want to go to a financial advisor and want to set one up myself. Any ideas on where I can look?

Thanks in advance

DAVE

Richie(UK)

Are you sure that you want an endowment? Many endowment policy holders in recent years have found themselves facing shortfalls on the estimated payouts.

Endowments basically offer 2 things, life cover and an investment designed to pay off the outstanding capital on the mortgage. You may be better off getting separate life cover and looking for an alternative way of paying off the capital.

How you do that depends on your risk profile - the 'safe' way is to change from interest only to a capital and interest mortgage. Many people make use of ISAs but it is important to remember that this is just a tax wrapper - it is the underlying investments that will determine the returns that you make. Are you proposing to pick the investment funds yourself? Given the importance of paying off your mortgage it may be invaluable to get some advice from an IFA (just my opinion and, no, I'm not an IFA!)

dunstonh

need to look at setting up an endowment to pay back the capital.

They dont exist any more. They went obsolete around 1995. The last mainstream provider to offer it (Standard Life) was back in 2003.

I don't really want to go to a financial advisor and want to set one up myself.

You want to set up an obsolete product that is less tax efficient and more expensive than modern options. Do you still think that not seeing an adviser is best way?

Any ideas on where I can look?

What target growth rate are you going to use?
How much does that equate to in monthly cost?
Which tax wrapper are you going to use?
Which investments are you going to use?
How does all that compare to the cost of a capital and repayment mortgage?

stubbyd

dave1140 wrote: »

I am currently on an interest only mortgage and need to look at setting up an endowment to pay back the capital. I don't really want to go to a financial advisor and want to set one up myself. Any ideas on where I can look?

Here's my 2p worth.

Look into a One Account (such as Virgin's One Account) - that way you can continue your interest only mortgage whilst allowing the way they work to start paying it off.

opinions4u

Switch to a repayment mortgage.

Why would you want to do anything else?

(deliberately open question at the end)

CloudCuckooLand

Ask your Lender what types of alternative repayment vehicles they accept..? Turn the question round, do you want to set something up, and then have your lender decline to accept it..?

They may have something "ready to go"...Mortgage ISA, perhaps.

Although repayment is hard to beat for certainty.