more info on endowments please!

jj88_2

Hi,
I need information on endowments please as I do not really understand them and I have spoken to a IFA and he just kept advising me to go with a cash ISA which is not what I want :mad::mad: I have also spoken to Prudential but they can't tell you anything - all she kept saying was "You need to go through an IFA".

Our life insurance is £25 a month, which covers us for £185000 if me or my husband dies (a bit morbid!). We got nothing else form it and loose all that money. My husbands grandad has recommended we get an endowment policy as it pays out if one of us goes, but we MAY also get money back.

I want to know how much we need to pay in each month, and how much we may get back, and is it guareented to pay out on death? And anything else I need to know!

Please do not think I am being rude, but I am aware that there are risks, I just need to know more about them (not be told use a cash isa lol!)

Thanks

Let_Us_See

I can 99.999999% predict you do NOT want an endowment. You appear to have a joint first-death life policy(possibly to cover your existing mortgage?) and you are now seeking some form of life cover/savings/investment advice? If so, it is not an endowment you need. Suggest you listen to the IFA and sack your husband's dad!

kingstreet

Bundled savings and protection products are a thing of the past.

There are cheaper and more tax-efficient options, such as an ISA and a term assurance nowadays.

Personally, I think there is still a place for such a plan with realistic future expectations of growth, but after the endowment debacle, you simply won't get one. Life offices will never offer them as the risk is far too high, as are the running costs.

dunstonh

I have spoken to a IFA and he just kept advising me to go with a cash ISA which is not what I wan

It may not be what you want but chances are it is what you need.

I have also spoken to Prudential but they can't tell you anything - all she kept saying was "You need to go through an IFA".

Correct response.

My husbands grandad has recommended we get an endowment policy as it pays out if one of us goes, but we MAY also get money back.

And what qualifications and training does your husband's grandad have that would make him more knowledgeable than the IFA?

I want to know how much we need to pay in each month, and how much we may get back, and is it guareented to pay out on death? And anything else I need to know!

If you are paying £25pm now for £185k on a term assurance than an endowment policy would be around £250-£300pm for the same level of cover. Could you afford that? It wouldnt be tax efficient as ISA and pure term assurance is better for tax and cost. However, none of that matters as the last mainstream endowment provider ceased to offer endowments in 2003. So, you would need a TARDIS.

I don't know how your husband's Grandad would get around that

comeandgo

A long time ago endowment policies were good things to have, I even still have an old one running but they cost a lot more than the money you are paying at the moment, I can understand where you are coming from, the insurance cover you have at the moment is dead money, as is any insurance if you dont claim on it.

lemontart

do not touch an endowment with a barge pole let alone your hard earned money - I speak from experience having fallen fowl of one with my mortgage and despite having paid in for 25 years if it failed me and I am having to pay a remortgage for difference for next 15 years so feels like I am paying twice .