How to turn £32k into £52k in 6 years!!!??

charismatic13

Hi!!

I have two endowment policies one of which has just matured this week and paid out 23K, should have been 34K. The other is due to mature in May 2103 s/be for 18K but is more than likely going to be 10K??

My dilemma is I still have 52K endowment mortgage which is due for payment in 6 years time.

Question: Can I invest the 32K over 6 years and make 52K, if so, HOW??

Or do I reduce some of the endowment mortgage (52K) to repayment and invest the matured policies??

All advice gratefully received

Charismatic:)

xylophone

Can you repay £23000 of your mortgage now and another £10000 next May?

dealer_wins

To get that sort of return will mean putting your £32000 at significant risk.

You need about a 9% return per annum, which is way more than you can achieve risk free.

CKhalvashi

dealer_wins wrote: »

To get that sort of return will mean putting your £32000 at significant risk.

You need about a 9% return per annum, which is way more than you can achieve risk free.

I'd dispute that, but you won't get FSCS protection on that sort of rate

CK

DiggerUK

charismatic13 wrote: »

.....I still have 52K endowment mortgage which is due for payment in 6 years time.
Question: Can I invest the 32K over 6 years and make 52K, if so, HOW??.....

First you need to realise that your poor return has come from a period that included the good times, and accept that these are the bad times with no end in sight.
So, do you want to stay on that investment road?

I personally would have no problem putting money in to gold, as I would expect to make up the shortfall easily over a six year time frame. But there again, I follow the gold market and I am happy with what I know about it. You on the other hand may have to do a lot of research. Best of fortune.
..._

Voyager2002

DiggerUK wrote: »

I personally would have no problem putting money in to gold, as I would expect to make up the shortfall easily over a six year time frame. But there again, I follow the gold market and I am happy with what I know about it. You on the other hand may have to do a lot of research. Best of fortune.
..._

And I personally would steer well clear of gold.

swift1_2

Hmm, interesting situation and may well be reasonably achievable.
Your asking for a £20k return on a £32k investment, a return of 62.5% over 6 years, roughly 10% per annum.

I'm quite familiar with the stock market, it depends on your knowledge and how comfortably you are. Stocks vary with risk, you have fairly low risk stocks and high risk stocks.

I would stick to the big the ftse100 companies that are high yielding and have weathered the financial crisis quite well.
As well as the high yield you may well have good capital growth to add.
Some stocks for you to consider are Royal & Sun Alliance (RSA), Vodafone VOD, Aviva (AV.) (- if you can buy this sub £3 your laughing all the way to the bank!) and prob quite a few others.
Try and use a shares ISA to maximise returns. Most of these stocks yield 7% upwards, you can get 10% (I have achieved this!) plus a great capital return.


all the best.

swift1_2

forgot to add, don't forget about the power of dividend reinvestment, this is quite a powerful tool that builds great wealth over the long term, just do the maths and you'll soon see how a powerful tool it really is.

Infact, a lot of articles suggest that the main returns of the stock market are down to dividend reinvestment.

N1AK

charismatic13 wrote: »

Question: Can I invest the 32K over 6 years and make 52K, if so, HOW??

Can you afford to only have £20k left in 6 years when you need the £52k? If you can't then you can't invest in funds or shares; it's really that simple. If you can go put £10k on black at roulette and if you'll be fine (or do something a little less risky and stick it in stocks/funds).

I would expect you could get your money to around £42k in 6 years within safe financial products; probably even a little more with more investigation but there's no 'safe' way to get 10% pa.

tarsh

I had a similar dilemma a while back & once we started getting the red letters warning the endowments would not pay out what was expected, we took the decision to switch to repayment mortgage & started overpaying a small amount; then as the repayments reduced each year we kept the payment the same, so the overpayment gradually increased.

I think to put this money in the stock market is too risky, as you could easily lose a significant amount before you need to cash it in.

You are probably best advised to get professional advice from a reputable IFA, but if it was me, I would switch to repayment, pay off lump sums with these 2 endowments, then at least you will be reducing the amount owed regularly over time.

neilem

I am also interested in this. When people say high risk, can they give examples? I assume they mean sticking money on DodgyInc in the stocks, or going to Las Vegas?

Would have thought there are better options than this...