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What would you do in my situation?
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geri1965_2
Posts: 8,736 Forumite
Please be gentle with me, I've never been in this forum before!
I have approx. £27,000 left on my mortgage. I have an endowment which has about £19,000 in it although it is not due to mature for a few years.
I could cash in the endowment and use it to pay off part of the mortgage, and pay the balance off with my savings. I would have about £10K of savings left if I did this.
I don't know if this is a good idea or not. I like the idea of not having a mortgage, but I don't know if it makes better financial sense to leave the endowment until it matures.
Can anyone advise?
I have approx. £27,000 left on my mortgage. I have an endowment which has about £19,000 in it although it is not due to mature for a few years.
I could cash in the endowment and use it to pay off part of the mortgage, and pay the balance off with my savings. I would have about £10K of savings left if I did this.
I don't know if this is a good idea or not. I like the idea of not having a mortgage, but I don't know if it makes better financial sense to leave the endowment until it matures.
Can anyone advise?
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keep endowment going as it's only a few years,nice nest egg£48515 interest £181 (2009)debt/mortgage-MFIT/T2/T3
debt/mortgage free 28/11/14
vanguard shares index isa £1000
credit union £400
emergency fund£500
#81 save 2018£42000 -
How is the endowment performing (i.e. what's the rate of growth vs. the mortgage rate)?0
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edinburgher wrote: »How is the endowment performing (i.e. what's the rate of growth vs. the mortgage rate)?
I don't know
I had loads of red letters in the early days, which is why I changed my mortgage to repayment and just kept the endowment as a savings plan.0 -
My endowment policies finished a few years ago, but from memory, you get annual bonuses calculated as a percentage of the basic sum assured, and a terminal bonus based on a percentage of all the bonuses earned.
They should send an annual statement giving the amount of bonus earned and the rate. You could ask them of the rate of terminal bonus currently being paid, to get an idea of what the are paying for this type of bonus.
If there's a terminal bonus, I think I'd keep the policy going until the end, keep my savings in case I needed the draw on them for any reason, and make overpayments to the mortgage to reduce it quickerEarly retired - 18th December 2014
If your dreams don't scare you, they're not big enough0 -
I've never had a bonus with it.0
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The bonus goes towards the pot value. You don't actually receive it.Mortgage at 01.01.14 £119,481.83:eek: today £0 Emergency fund £5.5/5.5k & £200/200 cash.:jWeight 24/02/19 14st 7lb now 12st determined to stop defining myself by my mistakes. Progress not perfection.:T100%through my 1% mortgage challenge. 100% through my pb challenge.0
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Please check what kind of endowment you have as I have a units based endowment, rather than the with profits endowment which are regularly mentioned on here. They are completely different and my units based endowment has a bonus in the final year only (not each year). I've decided to keep mine going just as an investment and will see what I get in 2025!Mortgage free wannabeMortgage (November 2010) £135,850Mortgage (November 2020) £4,7840
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I phoned them and she said there was no terminal bonus, but they tend to perform better in the last 5 years.
No idea if that is bull-youknow what or not, anyway, she is sending me some 'projections'. I am inclined to keep it now as there is only 7 years or so to go.0 -
What's the interest rate on your mortgage compared with what you get on your savings? Also, what type of home do you have? My house was built in 1916 so we always need access to funds to fix the bits that fall apart.Mortgage at 01.01.14 £119,481.83:eek: today £0 Emergency fund £5.5/5.5k & £200/200 cash.:jWeight 24/02/19 14st 7lb now 12st determined to stop defining myself by my mistakes. Progress not perfection.:T100%through my 1% mortgage challenge. 100% through my pb challenge.0
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