Endowment - to seel or not to sell

Bad_Manners

I have a Scottish Amicable endowment policy, which I took out in 1993 and it matures in 2015. The policy was planned to generate £75k and I have just had a surrender value from Scot Am of around £47k and the policy is in the RED zone in all their forecasts.

I am investigating selling the endowment to get a bit more than the surrender value quoted by Scot Am. I would then pay the sum raised into my mortgage and start overpaying my mortgage a sum sufficient to clear it by 2015.

Would I be better to keep the policy going to maturity? I have read about the falling maturity values with Scot Am and the economic situation in the next couple of years could be dire, so selling out now appears attractive.

ffacoffipawb

Bad_Manners wrote: »

I have a Scottish Amicable endowment policy, which I took out in 1993 and it matures in 2015. The policy was planned to generate £75k and I have just had a surrender value from Scot Am of around £47k and the policy is in the RED zone in all their forecasts.

I am investigating selling the endowment to get a bit more than the surrender value quoted by Scot Am. I would then pay the sum raised into my mortgage and start overpaying my mortgage a sum sufficient to clear it by 2015.

Would I be better to keep the policy going to maturity? I have read about the falling maturity values with Scot Am and the economic situation in the next couple of years could be dire, so selling out now appears attractive.

Is it traditional with profits - with a basic sum assured and bonuses added each year?

dunstonh

You have given the surrender value but what is the current value/position?
What are the projections?
how much are you paying?

I have read about the falling maturity values with Scot Am and the economic situation in the next couple of years could be dire, so selling out now appears attractive.

The economic situation and investment returns dont go hand in hand. The markets tend to factor in the known already.

Bad_Manners

Thanks very much for replies.

The additional information is:
It is a traditional with-profits fund
The valuation at 31 Dec 2010 was £30,000
The latest projections indicate a shortfall of £5,800 at 8%, £10,800 at 6% and £15,600 at 4%

Bad_Manners

Forgot to add to last post: the payments I make are £133 per month and I have made all payments to date