We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
The Forum now has a brand new text editor, adding a bunch of handy features to use when creating posts. Read more in our how-to guide
Calculate endowment rate
jgh
Posts: 177 Forumite
My endowment matures in five years. I've got a statement saying what it's worth now, and three projected end term figures for three different growth rates. Is there a formula I can plug in the "now" value to work out what the rate has been over the last 20 years to see which of the projected figures is going to be most likely.
A naive calculation would be ( (nowvalue) divided by (480 months) ) divided by (monthly premium). This shows that my £50 monthly premiums have all added up as though I've just added up 240 chunks of £52.75. Does this mean a 5.5% growth rate? Or do I need to work out the 480th root of nowvalue or something?
ta
A naive calculation would be ( (nowvalue) divided by (480 months) ) divided by (monthly premium). This shows that my £50 monthly premiums have all added up as though I've just added up 240 chunks of £52.75. Does this mean a 5.5% growth rate? Or do I need to work out the 480th root of nowvalue or something?
ta
0
Comments
-
I wouldnt want to use past rates as a guide to the future.
Providers are required to use projection rates that are within the potential of the fund. If you get a 10 year period like the last you would be closer to the lowest rate. If you think the next 5 years are going to see recovery then you will get something like the higher rate.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
But I don't know what the past rate has been, that's why I'm trying to see if I can calculate it from the figures on the statement.Providers are required to use projection rates that are within the potential of the fund. If you get a 10 year period like the last you would be closer to the lowest rate.
I just want to work out what the last 20 years' performance has been just to have a figure to compare to. It's like when you enter a lottery for a collegue's baby's birth weight. You first need to have some sort of idea of a number to start with. 1kg? 20kg?I wouldnt want to use past rates as a guide to the future.0 -
JGH,I have just lately received a cheque from Aegon,former Scottish Eqitable for my matured endowment,£23 per month for 25 years for a mortgage of £16,000.
I received the warning letters some time ago but decided to stick with it and to my surprise i received 17K a few weeks ago0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 353.9K Banking & Borrowing
- 254.3K Reduce Debt & Boost Income
- 455.2K Spending & Discounts
- 247K Work, Benefits & Business
- 603.6K Mortgages, Homes & Bills
- 178.3K Life & Family
- 261.1K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.7K Read-Only Boards